Feeling unsure about your retirement plan? You’re not alone. A recent survey of 1,586 women conducted by TIAA and YouGov found that only 26 percent feel good about their retirement savings. Women, especially mothers, often prioritize family spending over their own financial well-being. TIAA, YouGov, and economist and author Emily Oster are working together to help women and moms retire better.
Oster was surprised by the survey results, which showed that almost half of women had no retirement savings and 27 percent were unhappy with the amount they had saved. Education level was a significant factor in retirement savings, with women with postgraduate degrees saving more than those with high school degrees.
The gender savings gap can be attributed to short-term thinking and financial constraints. Women often dip into savings or 401ks to cover expenses during maternity leave, impacting their long-term retirement savings. Childcare costs also play a significant role in women’s decisions about work and savings.
Melody Evans, a wealth management advisor at TIAA, encourages women to think about the bigger picture and plan for retirement, even if they choose to stay home with children. Starting with a budget and having open conversations about expenses and retirement savings can help women make informed decisions.
While there is no set amount that everyone should save for retirement, tools like TIAA’s retirement calculator can help individuals assess their current savings and plan for the future. It’s essential to regularly review your financial situation and seek guidance from a financial planner if needed. When unsure of the percentage of income to save, simply divide the annual savings amount by your yearly salary. In a recent survey, 49 percent of women struggling with savings mentioned that they had no leftover income for retirement after covering bills and rent. However, even small contributions can accumulate significantly over time. For instance, saving just $5 per month from ages 30 to 65 can result in $10,000 in retirement savings, while saving $100 per month can grow to $160,000. It is crucial for women to have their own retirement accounts for financial independence and decision-making power. If your employer doesn’t offer a retirement plan, consider opening a traditional IRA to start saving. Remember, it’s never too late to begin saving for retirement. By increasing financial transparency and discussing retirement planning, women can empower themselves and bridge the gender wage gap. Knowledge is key, so utilize available resources like calculators to make informed financial decisions.