As more Americans turn 65 than ever before, a new report by the Nationwide Retirement Institute (NRI) finds that more women believe they are on the “wrong track for retirement” while others are concerned about outliving their savings.
NRI’s In-Plan Protected Retirement report surveyed 1,200 employer-sponsored retirement plan participants and found that 23% of women believe they are off track for retirement compared to 15% of men, and 52% are worried they will outlive their anticipated longevity. Another 41% say they have a negative or neutral outlook on retirement planning, relative to 29% of men.
Their outlooks on long-term planning could stem from the fact that more women report concerns over a recession or economic downturn and the impacts of rising costs or market volatility on their retirement savings, the NRI states.
Still, the report shows that only 13% have diversified their investment portfolio and 15% have looked for other investment options that provide protection during volatile markets.
“Women are actively participating in their employer-sponsored retirement plans alongside their male counterparts, but they’re also facing a variety of challenges that can make navigating their retirement journey more complex,” said Cathy Marasco, leader of Protected Retirement for Nationwide Retirement Solutions. “Women are likely to live longer in retirement, so it’s understandable that fear of outliving their income would be a source of anxiety.”
Dips in financial confidence
The report comes as more women report lower levels of confidence with long-term finances. Research from New York Life’s Wealth Watch survey found that while women are confident in managing their short-term finances like saving for emergencies and paying bills, they are much less confident than their male counterparts in building wealth, creating investment portfolios, and understanding protection products like insurance and legacy planning.
“Women are likely to live longer in retirement, so it’s understandable that fear of outliving their income would be a source of anxiety.”
Cathy Marasco, Nationwide Retirement Solutions
New York Life’s study found that women primarily handled paying bills, monthly budgeting, and financial account management, whereas men were in charge of choosing and maintaining a relationship with a financial advisor, financial account management, managing household investments, managing retirement savings, and purchasing financial products like insurance, annuities, mortgage, etc.
Women in this study reported wanting more information, with 82% saying they wish they knew more about at least one financial topic, including building wealth (29%) and saving for retirement (25%). While more say they would prefer to get financial advice from a professional, the study shows that younger women are obtaining financial help—a promising movement, New York Life notes.
“Financial education for women is evolving – Gen Z and Millennial women report having received formal financial literacy education at much higher rates than Gen X and Baby Boomer women,” said Jessica Ruggles, corporate vice president of Financial Wellness at New York Life. “Financial experiences and confidence vary by age, suggesting the need for women to seek individualized support and guidance from a financial professional.”
‘Pension-like’ protection
Due to their challenges and concerns with retirement savings, a three-in-four women are also expressing interest in “pension-like” income streams, reports Nationwide. Nine in 10 women also say they would be at least somewhat likely to roll over their money into an in-plan protected retirement solution if it was offered to them.
“Women who participated in our study say a pension-like income stream would reduce their stress, increase their financial security and improve their peace of mind,” added Marasco. “It’s time for employers to extend those same benefits to today’s workers by offering a guaranteed lifetime income investment solutions through their qualified employer-sponsored plan.”
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