As they emerge from the pandemic, women are facing a heavy burden of retirement insecurity due to societal factors that include a persistent gender pay gap, time out of the workforce for caregiving, and less access to employer and government benefits, according to survey results released Thursday by the Transamerica Center for Retirement Studies.
Fully 41% of respondents said they plan to retire at age 70 or older, or do not plan to retire at all, according to “Emerging from the COVID-19 Pandemic: Women’s Health, Money, and Retirement Preparations.”
Employers will play a big role in ensuring that more women can achieve a financially secure retirement post-COVID, the authors contend.
“We must spotlight women’s longevity and their retirement insecurities. Now is the time to implement solutions so that all women can retire with dignity,” said Catherine Collinson, CEO and president of Transamerica Institute and TCRS.
The online survey was conducted among almost 5,500 workers at for-profit companies by The Harris Poll between October and December 2021. Among the more than 2,600 female respondents, 37% said they experienced negative employment effects as a result of the pandemic, including reduced work hours (21%) and reduced salaries (13%). More than four in 10 said they are finding it difficult to make ends meet, and 57% said their incomes will not allow them to save for retirement.
Only 21% of women workers expressed being “very” confident they will be able to fully retire with a comfortable lifestyle, and only 24% “strongly” agreed that they are on track with a retirement nest egg. Most (76%) said they are unsure whether Social Security will be available when they are ready to retire.
Caregiving and savings
In addition, caregiving duties were shown to have a substantial effect on women’s financial stability. Aside from parenting duties, 38% said they had served as a caregiver to family or friends during their working career, and most of those respondents recounted adjusting their employment situation to meet those demands, including missing days of work (35%) and reducing work hours (25%). Ten percent said they had quit a job to provide caregiving.
In the meantime, 28% of women respondents expect to rely on Social Security as their primary source of income in retirement, whereas another 45% plan to turn to self-funded savings from 401(k)/403(b)/IRAs and or other savings and investments. Only 47% who work part-time said they are offered such plans.
Household retirement savings among women workers are “alarmingly low,” the surveyors said, with baby boomers saving the most among the generations, at $101,000 across all household retirement accounts. Although saving for retirement was noted as a high priority, even more women said they were concerned with paying off debt.
Notably, 16% of women said they expect to rely on income from working. And most who said they plan to work past age 65, or do not plan to retire, said financial or healthy aging reasons influenced that choice.
Part of the solution
Solutions for improving women’s long-term financial outlook must come from employers, policymakers and individuals, Collinson said.
She and her colleagues recommend that employers help ensure gender pay equity and expand their retirement, and health and welfare benefits offerings to include both full-time and part-time workers. Flexible work arrangements aimed at promoting work-life balance can help more employees stay in the workforce amid competing demands, she said.
“Women’s ability to achieve a secure retirement ultimately depends on equitable pay throughout their working years; access to retirement and health and welfare benefits; and the preservation of safety nets such as Social Security and Medicare,” Collinson said.
