Retirement Planning for Women: It's a Whole New Ball Game

As if women don't already have enough challenges in the workplace, saving for retirement is also more difficult than it is for men.

Saving for retirement is difficult for everyone, but retirement planning for women is especially complex. That's because women, for a variety of reasons, generally enter retirement with less money than men and then they face a number of particular problems.

Both the pay gap and time in and out of the work force for events like maternity leave impact a woman's ability to build a sufficient nest egg. Plus, women live longer which, of course, requires more money. 

Here are some stats from a recent survey:

  • Retirement confidence is higher among men (64%) compared to women (54%)
  • Men (55%) are more likely than women (42%) to agree that they are building a large enough retirement nest egg.
  • Men (31%) most frequently say that their greatest financial priority is "saving for retirement," while women (25%) most frequently say "just getting by - covering basic living expenses."

It's not easy to overcome this gap. The best advice is to start early, seek professional advice, live frugally, and sock away as much as you can. And buy long-term care insurance. Life is not getting any shorter.

When You Retire, Will You Be Receiving a Pension? Probably Not.

Most of our grandparents could count on receiving a pension when they retired, and some of our parents could, too. You and I, however, are out of luck. Retirement planning is up to us. And if we don't look it squarely in the eye and take control over it, we may one day wind up searching for affordable senior housing in a land without affordable senior housing.

Many people underestimate how much money they will need to fund retirement. Today, a 50-year-old male on average will live to age 80; a 65-year-old to 83; and a 75-year-old to 86. Women average several years longer.

This means if you plan for a 20-year retirement, half of all people will run out of money. Do you want to get a job at age 85?

If both partners in a couple are 65, there is a 72 percent chance one of them will live to 85. The odds of one reaching 90 is 45 percent, and 18 percent on making 95.

That is great news if your health and quality of life can be maintained. Plan for this possibility by monitoring early spending and maybe creating your own private pension.

Like it or not, most retirees today do not receive a pension and are ultimately responsible for their own retirement decisions. Start early, seek professional help, and maximize your retirement assets.