Although many people are aware of the wage gap between men and women, many are not aware of the discrepancy that they have when it comes to retirement issues as well. This lower pay that women receive over the course of their careers translates into a gap in the benefits they receive during their retirement years.
This pay gap reduces the Social Security benefits, pensions, and retirement savings they will have available to them when they retire. At the same time, women enjoy greater longevity than men typically do, which means their resources must often be stretched over a longer period of retirement.
According to the latest mortality tables from Society of Actuaries, women will live to an average age of 88.8 years of age while most men will only live to 86.6. And income inequality has become a major contributor to this growing disparity of retirement funds that are available to the different sexes during their retirement. According to the National Women’s Law Center a woman who works full-time over a 40-year period loses $435,480 in lifetime income (today’s dollars) due to the gender gap in pay. This means that women will need to work roughly 11 more years than their male counterparts to achieve the same level of security for their retirement.
Yet there are signs of progress for women when it comes to this retirement disparity issue. Women are working longer hours and spend a longer time of their lives in the workforce. Their retirement plan gap has decreased as well. Forty-six percent of women participated in a workplace retirement plan in 2012, the same rate as men. Women are also waiting to claim their Social Security benefits at a higher age too, with 9% waiting until age 70 or higher before making a claim.
Yet even tough this retirement gap is decreasing, women must still be aware that there is a need to save for longer times they may live in retirement. With a bit of guidance to help invest their hard-earned savings many women will live to have a very comfortable and enjoyable retirement. For more information on this topic, feel free to contact us for more information and details.