Women and Retirement: Navigating Financial Security for a Bright Future

Women and Retirement: Navigating Financial Security for a Bright Future

Financial planning extends beyond everyday savings and budgeting; it also includes planning for a secure retirement without stress and worry.

For many full-time employees, saving for the future is made easy by the employer. With benefits like 401(k) matching, safe harbor plans, contribution flexibility, and expansive investment options, many are lucky to have security built into their everyday jobs. However, Wiser notes that on average, women have less money at retirement compared to men because they often put their careers on the back burner while they take time to care for children or elderly parents in the home.

In most companies, part-time workers receive fewer benefits and options compared to full-time employees. While full-time staff may have access to a company retirement plan and matching contributions, part-time workers may not have access to the plan at all.

Because of these disparities, along with gender norms that still exist in the home and office, many women are at a disadvantage in retirement planning. But, it’s not all bad news. There are ways for women to succeed at home and work, while also securing a bright financial future. Read below to learn more.

The Retirement Gender Gap: Understanding the Disparity

When considering the retirement gender gap, there are a few key factors that make the biggest difference. It’s no secret that women earn less than men in the workforce, but what people forget to consider is that it also creates retirement inequity. Earning less money means having less income for investing and retirement accounts. Additionally, women who take time to have children or care for parents are taking extended leaves of absence and losing out on full-time salaries and benefits.

According to a 2020 report from the National Institute of Retirement Security (NIRS), the median household income for women aged 65 and older is approximately $47,000 compared to men, who earn an average of $57,000. For women who live in dual-income families, this may not be a huge concern. But for women who are the primary provider, or an equal provider in the household, the gap can create financial challenges.

Breaking Barriers: Building Strong Financial Foundations

Breaking through the gender gap barriers requires financial planning, strategy, budgeting, and other tactics to put you on a path to a secure retirement. Luckily, there are many free resources you can utilize to help,  including apps, podcasts, books, videos, and more.

  • Create a Budget: Having and maintaining a budget is key to financial planning. Whether you’re enhancing your retirement savings, managing everyday spending, or trying to establish a path to financial freedom, a budget will help you get there. Learn how to start a budget and how to use budget rules like the 50/30/20 strategy.
  • Mobile Apps: Budget apps like Mint or Spendee allow you to track all of your income and expenses in one place, set and track goals, and review and manage investments. Combined, you will have access to your full financial snapshot at your fingertips and can clearly see where you may need to make reductions or additions in your plan. Learn more about the apps here.
  • Debt Management: If you have a mountain of debt that prohibits you from planning for retirement, read the Slavic401k blog to learn how to manage it. Strategies like consolidating debt, using the snowball method, or adjusting your budget can jumpstart your efforts with minimal effort.
  • Explore Retirement Plans: If you don’t have a plan for a retirement nest egg, learning about IRAs and 401(k) plans will help you determine which might be right for you. Retirement is not one-size-fits all, so it might help to speak with a financial advisor, like our team at Slavic Wealth Management, or visit your financial institution. Strategies and approaches differ, so make sure you find someone with a background in financial planning, and makes you feel comfortable and confident about putting a retirement savings plan together.

Work-Life Balance and Retirement Preparedness

Managing work-life balance can be challenging, especially for working women who also serve as the primary caretaker in their home. Wiser notes that women have fewer years of earned income due to caretaking responsibilities and are more likely to work part-time jobs. This creates a retirement saving challenge due to either zero or reduced income, as well as limited benefits from an employer.

Forbes suggests a few strategies that can help women in the workforce find balance between work and home:

  • Discuss flexible work hours with your employer.
  • Work with your employer to create a post-maternity leave plan that allows you to ease back slowly into the workforce as you adjust to your new normal.
  • Discuss remote work options or find a job that allows you to work from home, providing more flexibility, and eliminating the commute time factor.

Gender and the Economy explores work-life balance and care responsibilities, as well as how it can be negotiated in the workplace and home.

  • At home, work with your partner to divide responsibilities at home. Historically, cultural norms indicated that women should be home while men work. That is not conducive to today’s family and career structures.
  • Negotiate daycare benefits with your employer if there is no on-site daycare.
  • Negotiate the design of your job, such as moving from a full-time or part-time five-day workweek to a three or four-day workweek if it helps with your home and care responsibilities.

Regardless of your work-life balance and financial structure, it’s important to remember self-care and stress management. The cycle can be vicious – poor mental health can make managing finances harder, and worrying about finances can poorly impact mental health. Consider these strategies from Slavic401k to reduce financial stress.

Disparities in the home and workplace can be debilitating for women who are struggling to maintain work-life balance while saving for the future. With the proper financial strategy and flexibility in the workplace and at home, there are ways to improve all aspects of your life that allow you to also secure a stable retirement.

To evaluate your financial snapshot, contact Slavic Wealth Management. We can help you sort through your budget, investment strategy, and retirement plan. If you need to make adjustments in your career, discuss the changes with your employer’s HR team.


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