Retirement, Emergency Savings Among Women’s Leading Financial Priorities

Despite making strides in their careers and independence, women savers continue to feel severe financial insecurity.

New findings from the Transamerica Center for Retirement Studies’ “25 Facts About Women’s Retirement Outlook” report shows that 18% of women workers feel “very confident” in their ability to fully retire with a comfortable lifestyle. The report surveyed 5,493 workers, including 2,489 women and 2,960 men.

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Limitations, including the ensuing gender pay gap and ongoing caregiving responsibilities, have narrowed their savings potential, observes Catherine Collinson, CEO and president of Transamerica Institute and TCRS.

“Women have made extraordinary progress in terms of educational attainment and career opportunities that were once out of reach. Yet, women continue to face a greater risk of not achieving a financially secure retirement,” said Collinson in a statement. “The gender pay gap and time away from the workforce for parenting and caregiving limit a woman’s lifetime earnings, her ability to save for retirement, and her access to valuable employer and government benefits. Statistically, women tend to live longer than men, so we need to save even more for older age.”

Transamerica’s report calls upon legislators to adopt reform that addresses these barriers and urges employers to consider benefits inclusive to women’s needs.

“Improving women’s retirement outlook is a collective effort,” said Collinson. “Policymakers can orchestrate societal change by implementing reforms to address structural barriers, employers can enhance their business practices and benefit offerings to be more inclusive of women’s needs, women can take greater charge of their financial planning as well as their long-term health, and men can lean in by advocating for them and serving as allies. Everyone can and should do their part.”

Read on the next pages for Transamerica’s 25 leading facts concerning women’s retirement below.

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25. Women could be doing more to protect their long-term health. When asked about health-related activities they do on a consistent basis, women’s top responses include eating healthy (55%), getting enough sleep (52%), socializing with family and friends (51%), and exercising regularly (49%). Only 22% of women consider their long-term health when making lifestyle decisions.

24. Many women could be more proactive about ensuring they can work as long as they want and need. Just 59% say they are staying healthy, while 53% are focusing on performing well at their current job, and 48% are keeping their job skills up to date.

23. Half of women (50%) expect to retire after age 65 or do not plan to retire – and 53% plan to work in retirement. Among women who plan to retire past age 65 and/or in retirement, more cite financial reasons (83%) than healthy-aging reasons (74%).

22. Women plan to live to age 90 (median) and 15% plan to live to 100-plus. Thirty-nine percent said they are “not sure” of the age they plan to live, which is a reasonable answer but not practical for financial planning.

21. Fewer than half of women (44%) are aware of the Saver’s Credit, a tax credit for eligible taxpayers who save for retirement in a qualified workplace retirement plan or IRA.

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20. Only 32% of women currently use a professional financial advisor.

19. One in four women (25%) have a financial strategy for retirement in the form of a written plan.

18. More than four in 10 women (43%) expect they will need to provide financial support to a family member(s) (other than spouse/partner) while they are retired. Twenty-three percent of women expect to receive financial support from their family while they are retired.

17. Few women (19%) frequently discuss saving, investing, and planning for retirement with family and close friends.

16. Women estimate they will need to save $500,000 (median) to feel financially secure in retirement but, among those providing an estimate, 52% say that they “guessed” their needs.

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15. Just 16% of women say they have “a lot” of working knowledge about personal finance.

14. Women have $56,000 in total household retirement savings (estimated median). Baby Boomer women have saved $165,000, compared with Generation X ($77,000), Millennials ($52,000), and Generation Z ($26,000) (estimated medians).

13. More than one-third of women (37%) have taken a loan, early withdrawal, and/or hardship withdrawal from their 401(k) or similar plan or IRA.

12. Among those offered a 401(k) or similar plan, 79% participate, contributing 10% (median) of their salary.

11. Women who work full time are more likely to be offered a 401(k) or similar employee-funded retirement plan than those who work part time (80%, 50%, respectively).

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10. Most women (79%) are saving for retirement at work and/or outside the workplace.

9. More than three in four women (77%) are concerned that Social Security will not be there for them when they are ready to retire.

8. More than one in four women (27%) expect Social Security to be their primary source of retirement income.

7. Only 18% of women are very confident that they will be able to fully retire with a comfortable lifestyle.

6. Nearly three in four women (73%) are saving for health care expenses, including those who are through an individual account (e.g., savings, checking, brokerage) (51%), a health savings account (31%), a flexible spending account (19%), and/or other (4%).

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5. Women have only $3,000 in total household emergency savings (median) to cover the cost of unexpected major financial setbacks.

4. Women’s top-cited financial priorities include saving for retirement (53%), building emergency savings (45%), paying off credit card debt (39%), saving for a major purchase or life event (37%), and just getting by to cover basic living expenses (36%).

3. More than four in 10 women (43%) are currently and/or have previously served as caregivers during their working careers. Among them, 85% have made work adjustments due to caregiving.

2. The “greatest” retirement fears among women include outliving their savings and investments (44%), Social Security being reduced or ceasing to exist in the future (43%), declining health that requires long-term care (43%), not being able to meet the basic financial needs of their family (38%), and cognitive decline, dementia, and/or Alzheimer’s disease (34%).

1. Women’s retirement dreams include travel (69%), spending more time with family and friends (61%), pursuing hobbies (49%), working (30%), volunteering (26%), and taking care of grandchildren (23%).