How Men and Women See Retirement Planning Differently

a man and a woman seeing retirement planning through different lenses

It’s no secret that men and women often approach things differently, whether communicating, shopping, or parenting. Gender even affects how men and women see retirement planning. Understanding key gender differences when planning for retirement, why they exist, and how to overcome them so both genders are better prepared can make a positive difference in retirement planning.

Personal finance professionals explain that, in general, women might do better to follow men’s lead when it comes to saving for retirement. On the other hand, men might be better prepared for retirement lows if their lifestyle expectations were more in line with those of women. Here’s what you need to know.

Women Save Less

According to the U.S. Census Bureau, women are more likely than men to have nothing saved for retirement. In addition, a recent survey by personal finance site Life And My Finances revealed that 41% of women have less than $10,000 saved for retirement compared to 35% of men. Conversely, just 3% of women have more than $500,000 saved versus 6% of men.

There are several reasons for the difference, experts say. Financial counselor Tiffany Grant, founder of Money Talk with Tiff, says the situation is multi-faceted. “Retirement planning is a complex and challenging process, and it can be even more complicated for women due to several factors like the gender pay gap, career breaks to care for children or elderly family members, and longer life expectancies,” she explains.

Derek Sall, founder of Life And My Finances, adds that another reason relates to marital status and children. “There are far more single mothers in the world today than single fathers. This means women, on average, have higher costs than men,” he says, adding that having to spend more to raise a family leaves less to save.

At the same time, women who save less than their male counterparts face a unique retirement risk. “Given that their lifespan may likely be longer than men’s, this disparity doesn’t help women with longevity risk–the risk they will outlive their assets,” says Jill Fopiano, president and CEO of O’Brien Wealth Partners.

Women Start Saving Later

Another reason women save less is that they start saving later than men. Research from Human Interest, a company that manages employer 401K retirement programs, reveals that the majority of men aged 40 to 49 say they’ve started thinking about retirement plans. In contrast, only 42% of women in that age range have done so. Women are also almost three times more likely to say they’re unsure when they’ll start thinking about their retirement plans.

“Women may start to think about retirement later because they have been less likely to have access to employee benefits that make it easy to save, like a 401(k). Part-time workers are less likely to have access to a retirement plan, and most part-time workers are women,” says Eric Phillips, senior director of partnerships and strategic insights at Human Interest. He adds that the SECURE Act 2.0, signed into law in late 2022, is designed to help remedy that problem by improving access among part-time workers.

Women Worry More About Retirement

While women focus on whether they’ll have saved enough for their lifespan and if they’ll stay healthy enough to enjoy it, men are more likely to focus on what they’re looking forward to, including leisure time activities.

“Women’s paths to retirement are more variable and less linear. When it’s hard to feel certain about what will happen next, it’s hard to know what your financial path needs to be to get you feeling ready for retirement,” points out Phillips.

Rajiv Nagaich, an elder law attorney and author of “Your Retirement: Dream or Disaster?”, says women are more cautious and worry more because they are less likely to be managing the family finances and therefore lack financial information. He blames this on traditional gender roles.   

“Though societal norms are changing, people who are baby boom-age or older tend to divide household responsibilities in more traditional ways, with men taking charge of financial planning and other matters outside of the home,” he says. 

Grant attributes some of women’s worries to earning power, too. “The gender pay gap affects women’s retirement savings and can limit their ability to save enough for retirement, making it hard to make time for simple enjoyment,” she says.

What Can Men and Women Learn From Each Other?

Women would do well to follow men’s lead and start thinking about and saving for retirement earlier. But considering the differences in earning power attributed to time out for family caregiving and pay inequities, experts are quick to point out that both genders should work to turn this around.

“Men should absolutely advocate more for women in careers and life. If the pay is not right, say something. Be supportive and understanding of the unique struggles women face,” says Grant.

Noting that many women are hampered by a perceived societal taboo around talking about money, Fopiano encourages women to push past that and become better informed about investing wisely for retirement.

“If more women were comfortable talking about money—with their spouses or partners, friends, or a professional advisor, they might be better prepared for retirement. Understanding how much they will need in retirement, the power of compounding and how it affects savings, and the risk/return tradeoffs of investing are all important to successful retirement planning,” she says.

When both men and women become more aware of how they plan for retirement differently, both genders will be better able to handle any financial, health, or other retirement surprises. That, in turn, will allow them to be better positioned to enjoy what they have saved. 

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