Scary but true. The U.S. Census Bureau says nearly half of us have no retirement savings. For most insurance professionals, retirement planning is a must, and most of you have some sort of plan in place.
However, for many women, retirement is farther in the future than for most men.The investment management firm T. Rowe Price said the balances of women in 401(k) accounts is about 65% of what men have in theirs.
Also, annually, women put 43% less in their plans than men. Women contribute an average of $5,421 compared to men putting about $9,578 in theirs.
Nationwide Insurance found that 62% of women plan to retire much later than men, or not at all. Of those with a retirement date in mind, Lowell Smith, the CEO of the retirement provider, Iralogix, says 30% have only enough money saved up to last one to three years.
“We weren’t expecting just how dire the situation is for women and the extent to which they’ve fallen behind in their retirement preparations,” Smith said. “What’s especially harrowing is how quickly even those who have saved for retirement are going to exhaust their savings.”
One big problem for women — as we all know — is that they typically live longer than men. Health issues then become a problem that eats up retirement funds. The Milliman Retiree Health Cost Index says women retiring at age 65, and living to age 90, will likely spend $300,000 on healthcare.
Men retiring at the same age and living to age 88 will see healthcare costs hitting about $264,000.
So why are women so far behind? Here’s a list gathered from a number of sources and why they start their careers at a definite disadvantage.
- Women usually have more student loan debt than men
- They make less money when they enter the job market
- Caregiving often derails careers
Currently, women are 60% of the enrolled college students in the U.S. And the education they’re getting often doesn’t pay off when you consider the cost of getting that education.
The average student loan debt for women is $30,296. For men that figure is $29,621. And — by the way — the Education Data Initiative says men are much more likely to get education financial help from their parents than women.
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