Women planning out finances at computer

Women and Finance: What You Should Know

Saving money for retirement is essential for people and couples of all genders. A strong portfolio of retirement investments will provide for you and your family as you age. If you’re a female, however, you may want to tuck away a little extra. Here’s why — plus, our best tips on how to do it.

Why Should Women Save More Money Than Men? 

Greater Longevity

Women typically live longer than men. The U.S. Census Bureau projects that women will have an average life expectancy of 87.3 years by 2060, while 83.9 years will be the norm for men. Genetic, biological, lifestyle, and behavioral differences all factor into this gap.

Because women tend to outlive men, this means women will likely need more retirement money. If you outlive your spouse, you’ll want to make sure you are covered for the rest of your life, even when they are gone.

Gender Pay Gap

The U.S. Bureau of Labor Statistics states that in 2021, women earned approximately $0.83 for every dollar earned by a man. Unfortunately, the gender pay gap is still very real; it’s even larger for women of color. And if you are earning less money, it stands to reason that your lifetime savings and overall wealth will also be smaller. Another study indicated that the typical woman had $0.55 for every dollar a man had.

Since Social Security is based on lifetime earnings, this gap persists when it comes to Social Security benefits. In 2019, women ages 65+ received an average annual income of $13,505 from Social Security. Men received an average of $17,374 — a $3,869 difference.

This is a problem because Social Security income tends to matter much more for women than it does for men. Unmarried women ages 65+ rely on Social Security for 47% of their total income, versus just 34% for men.

Time Spent Caregiving 

Another reason you might want to save more for retirement is because 67% of primary caregivers (who provide, on average, 26.7 hours of care per week) are women. If you’re busy taking care of an aging parent or raising your children, you might leave work entirely — women spend an average of seven years out of the workforce taking care of family members. As a result, you will have less retirement savings or not qualify for as many pension benefits.

Relationship Status

Your relationship status also impacts your retirement planning. Since women typically live longer than men, it’s likely that even if you are currently married or in a relationship, you may be single at some point in the future.

It’s common for older women to become widows. Data indicates that among married people of 75+ years, 58% of women had gone through the death of a spouse, but only 28% of men.

Tips to Help You Save

These are a few of the reasons why it’s important for women to save plenty of money. Here are a few ways you can save enough funds to see you all the way through retirement.

Start Early

If you’re reading this article, you’ve already taken the first step: awareness. Recognize that you may need to save more money to make sure you’re covered. Then start saving and investing as early as possible.

Experts typically recommend that you start saving for retirement in your 20s. Begin putting aside money when you get your first career job. Your employer may offer retirement benefits such as a 401(k). Another option is an individual retirement account (IRA). Aim to contribute between 10-20% of your annual income to your retirement account(s) each year.

Get Out of Debt

Any money that’s going to pay off debt could be money going toward retirement instead. Pay off your debt as quickly as possible by focusing on your most expensive loan first and considering paying more than the minimum payment.

Once you are debt free, this will free up additional $ you can invest for retirement. Avoid getting into debt in the future by following a budget, paying your bills on time, and not borrowing money.

Educate Yourself

Do you feel unprepared to manage your money? Gain confidence by looking for resources to help you learn. Local community colleges or adult education centers might have courses or seminars that you could take to learn about investing and personal finance.

Another way to learn about your investment options is by speaking with a Bankers Life financial representative, who can help guide you toward the smartest decisions to make for your future. Contact us today!

This material provides general information about the described insurance product(s) for educational purposes only. This is not intended as investment advice or to recommend the insurance product(s).

Bankers Life Securities, Inc., Bankers Life Advisory Services, Inc. and their representatives do not provide legal or tax advice. Each individual should seek specific advice from their own tax or legal advisors.

Bankers Life is the marketing brand of affiliated companies of CNO Financial Group including, Bankers Life and Casualty Company, Bankers Conseco Life Insurance Company (BCLIC), Colonial Penn Life Insurance Company, Bankers Life Securities, Inc., and Bankers Life Advisory Services, Inc.  Non-affiliated insurance products are offered through Bankers Life Securities General Agency, Inc. (dba BL General Insurance Agency, Inc., AK, AL, CA, NV, PA).  BCLIC is authorized to sell insurance in New York.

Securities and variable annuity products and services are offered by Bankers Life Securities, Inc. Member FINRA/SIPC, (dba BL Securities, Inc., AL, GA, IA, IL, MI, NV, PA).  Advisory products and services are offered by Bankers Life Advisory Services, Inc. SEC Registered Investment Adviser (dba BL Advisory Services, Inc., AL, GA, IA, MT, NV, PA).  Home Office: 111 East Wacker Drive, Suite 1800, Chicago, IL 60601

Investments are: Not Guaranteed-Involve Risk-May Lose Value.