Women continue to face challenges in preparing for retirement, including lowered confidence levels and setbacks in savings.
New research from Lincoln Financial, in honor of International Women’s Day on March 8, found that only 18% of working women have over $250,000 saved for retirement in their workplace retirement plan, compared to 25% of men. Women also reported decreased confidence in retirement decisionmaking, at 35% compared to 52% of men.
“Financial planning is not one-size-fits-all – for men or women – and planning for retirement will be based on the individual,” says Ralph Ferraro, senior vice president and president of Retirement Plan Services at Lincoln Financial, “That said, women may face unique challenges when it comes to securing their financial futures.”
One such challenge is caregiving, which tends to fall on women due to stereotypes that label them as natural caregivers. In fact, a 2023 study by the Transamerica Center for Retirement Studies (TCRS) found that almost half of women surveyed (41%) are currently or have previously served as caregivers during their working careers. Among them, 84% made work adjustments because of caregiving, including taking days off from work (37%).
In Lincoln Financial’s research, 43% of women say being a caregiver has impacted their careers, versus 31% of men.
The findings show that such misconceptions continue to occur today: 66% of Americans surveyed believe women are “better at providing long-term care than men. This leads women to expect that such a responsibility would fall on them, with 77% of women believe it will, as opposed to 64% of men.
Working with a financial professional to discuss their goals and create a personalized plan that factors in caregiving costs and long-term financial goals could ensure their future financial stability, adds Ferraro.
Additionally, using voluntary benefits offered through the workplace, like health savings accounts (HSAs), accident coverage, or hospital indemnity, could reduce unexpected healthcare costs that may deter retirement savings down the line. According to Lincoln Financial, 49% of employees expect the cost of healthcare in the future to “get worse” and 45% say covering a $500 out-of-pocket medical expense would be a financial hardship on them.
“Having the right tools to weather uncertainty and prepare for the future with confidence can make all the difference,” said Stephen Turer, senior vice president and head of insurance solutions at Lincoln Financial. “Not just for women, but for everyone, and that means feeling secure that you have the right coverage for today so that you can be prepared for tomorrow.”
SEE ALSO:
- The Three Key Moves to Decrease Financial Stress in Women
- Women Are Stressed in Balancing Caregiving and Work
- Less Women are Confident in Their Ability to Fully Retire
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
