A new study on women and retirement shines a light on some sobering statistics: nearly half of baby boomer women have no retirement strategy, while more than half either expect to work after 65 or simply do not plan to retire.
According to findings released this month by the Transamerica Center for Retirement Studies, most older women are so focused on paying off consumer debt and making ends meet that only 29 percent have made saving for retirement their top financial priority.
"As women, we're so busy with our priorities day to day -- whether they be family or work or some form of caregiving -- that women are shortchanging themselves when it comes to planning for the long-term," Catherine Collinson, president of the private nonprofit foundation in Los Angeles, told Huff/Post50.
The center's latest study, "Juggling Current Priorities and Long-Term Security: Every Woman Needs Her Own Retirement Strategy," surveyed 577 baby boomer women as part of its 13th annual study of the nation's retirement trends.
“There is a striking disconnect among women between how they envision their retirement and how they are preparing to realize that vision,” Collinson said. “Women face a number of unique circumstances, such as typically lower wages than men, time out of the workforce to be a parent or caregiver and a longer life expectancy, which present challenges for saving. As a society, we must do more to empower and equip women with the know-how to plan, save and ultimately achieve a secure retirement.”
The study found that women’s retirement dreams include traveling, spending more time with family and friends and pursuing hobbies; however, 61 percent of baby boomer women either expect to work after 65 or simply do not plan to retire.
Women’s expectations of delaying retirement and/or working in retirement illustrate a serious crisis of retirement confidence, Collinson said. More than half of women (54 percent) are “not too confident” or “not at all confident,” compared to only 44 percent of men who share that sentiment. Only 7 percent of women are “very confident” in their ability to fully retire with a comfortable lifestyle.
Behind this lack of retirement confidence could be women's lifelong concern about taking care of family. Women most frequently cite their single greatest retirement fear as not being able to meet the financial needs of their loved ones (26 percent). More than one in four women (28 percent) expect to take time or have already taken time out of the workforce to act as caregiver for a child or aging parent. Of these caregivers, 73 percent believe that this time out will impact their ability to save for retirement. Further, many reported that their retirement may involve financial caregiving; one in three women (31 percent) expects that when they are retired, they will need to provide financial support for a family member other than their spouse, according to the study's results.
in short, Collinson said the main key findings of the study are:
-- Only 14 percent of baby boomer women have a written retirement strategy. Some 45 percent do not have a plan at all while 41 percent have a plan that's not written down.
-- About 36 percent of baby boomer women expect to rely on Social Security as their primary form of income in retirement. Another 36 percent expect to rely on 401K plans while the rest expect to rely on a mixed bag of savings and assets.
-- Of the women who expect to rely on Social Security, only 34 percent say they know "a great deal" or "quite a bit" about their Social Security benefits.
-- About 61 percent of baby boomer women expect to work after 65 or simply do not plan to retire.
-- Only one in five baby boomer women who expect to keep working have a backup plan if retirement comes sooner than expected.
“Life’s unforeseen circumstances such as a job loss, health issues, or family obligations can derail the best of intentions,” said Collinson in a press release. “Especially with so many women planning to delay retirement or continue working part-time in retirement, a backup plan is an essential part of a retirement strategy.”
In the end, Collinson told Huff/Post50 that it's not surprising so many women expect to keep working but that it is surprising so few have a backup plan if they aren't able to do so.
As a result, she said women need to take steps immediately to improve the outlook for their futures including "learning more about their Social Security benefits, calculating a savings goal, understanding what a savings shortfall may look like and evaluating their expectations. There's no doubt that every woman needs her own retirement strategy."