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Money News

Why Women are Behind in Retirement Savings

November 20, 2019

The wage gap and less access to workplace plans have an impact.

2 min read

While retirement should be a time when you can stop working and just enjoy life, a new study shows that women may be less prepared financially for retirement than men.

A November, 2019 survey by The Transamerica Center for Retirement Studies found that men and women begin saving for retirement around the same time, and with roughly the same target sum in mind. But, women may fall behind men in retirement planning because they may make less than men on average. Women may also make more frequent career changes because they tend to be the primary caregivers in families.

The median estimated household retirement savings for women was only $23,000, compared to $76,000 for men, according to Transamerica, which conducts the survey annually with The Harris Poll. The survey collected responses from 5,100 workers and 1,800 employers.

What the Survey Found

The difference between men and women in their retirement savings begins early. The survey found that men start saving for retirement on average at age 26, while women begin a full year later, at age  27. And while both men and women hope to have a median $500,000 in retirement funds, 55% of women say they plan to retire after age 65, or not at all, compared to 53% of men.

Here are more details from the survey:

Women Who Have a Retirement Plan
Men Who Have a Retirement Plan
Source: TCRS

Women stay the course

The TCRS survey also found that 26% of women plan on using earnings from an investment account in retirement, compared to 42% of men, which could demonstrate that women are less likely than men to invest.

Women who plan to draw investment earnings in retirement
Men who plan to draw investment earnings in retirement

Source: TCRS

Yet, when women do invest, they are more likely than men to keep a level head during periods of market volatility, according to a Stash survey. 

The findings of the TCRS survey generally correlate with those of a November, 2018 survey from Stash, which found that more men tend to save for retirement than women. The survey found that slightly more than half of women who use Stash were saving for retirement, compared to two thirds of men.Don’t get left behind when it comes to retirement. You can invest and save for retirement with Stash.

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By Claire Grant
Claire is a content writer for Stash.

This material has been distributed for informational and educational purposes only and is not intended as tax advice. Consult with your tax professional.
Disclosure: Stash does not monitor whether a customer is eligible for a particular type of IRA, or a tax deduction, or if a reduced contribution limit applies to a customer. These are based on a customer’s individual circumstances. You should consult with a tax advisor.

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