Women trail men in retirement savings, experts say
Mar 17, 2022, 12:20 PM | Updated: Jun 19, 2022, 9:00 pm
SALT LAKE CITY — As more women break barriers in the workplace, there is still one area they fall far behind: saving for retirement. An expert explains how to bridge the gap.
Life is full of surprises, like Amanda Lambert’s freelance writing career that blossomed later in life. “I suddenly felt like, ‘Oh, I just found my voice,'” said Lambert, who lives in Salt Lake City.
But when it comes to retirement savings, she has no surprises.
“My parents were really good mentors to us kids because they were very conservative with their money,” she said.
Lambert learned the value of saving money and living within her means. She recalled a desk in her old house where her parents’ budgeting was visible and tangible.
“In each cubby was a white envelope and on the front was written, ‘Groceries, entertainment, gas,’ and there was cash in each of those,” she said. “But it worked, once the cash was gone, that was it. That just stayed with me.”
Thriftiness paid off, as Lambers has zero debt and now saves her pension payments each month. But statistically, she’s an outlier. Women save only 50% to 70% of what men are saving but live longer, and according to research by AARP, are 80% more likely to be poor in retirement.
“We have a huge retirement savings gap that for women that we just don’t talk about in this country,” said Mary Liz Burns, communication strategy director with AARP.
Burns said that stems from how women are socialized.
“We’ve heard a lot of these sort of old-fashioned messages either spoken or unspoken, that either women are bad with money, or we’re afraid of risk, or we don’t know what to do with our money,” Burns said.
The key, Burns says, is knowing it’s never too late to save for retirement. She recommends taking the 2% challenge. “Just save 2% of your income for retirement or if you are starting already to save try to bump it up one or two percentage points, every little bit, no matter when it is whatever it is, it’s going to make a difference,” Burns said.
Next, talk to your employer about 401(k) matching plans, and others ways to contribute. “If you get a bonus, or a windfall anytime you can put additional dollars in.” And stick with your retirement savings plan no matter what.
Lambert said, “You have to have faith that those little bits will add up over time, and then they do.”
She’s confident she’s prepared for the unexpected. Leaving the surprises for her writing and sticking to values she learned early on.
For more tips and help on saving for retirement visit here.