A complex variety of social and economic factors shape the way men and women view their finances. While the playing field of opportunity seems to be leveling for America's younger generations, gaps still exist in the way male and female Millennials feel about saving for retirement. According to a recent survey of workers between the ages of 25 and 35 who participate in a 401(k) plan, Millennial women report uncertainty and stress related to saving enough for a comfortable retirement in far greater numbers than their male counterparts.*
The survey found a majority (61%) of Millennial women feel they don't know what their best 401(k) investment options are, while less than half (44%) of Millennial men feel the same way. Likewise, a full 75 percent of female Millennials wish they had an easier way to know how to choose their 401(k) investments, compared to 59 percent of their male peers.
This uncertainty translates directly into stress. Four in ten (42%) Millennial women feel a lot of stress about choosing the right 401(k) investments. Young men aren't far behind, with more than one-third (35%) also reporting 401(k) investing-related stress.
This group is also keeping an eye on the future, which brings with it another set of worries. When asked which concerns them more - being healthy enough to enjoy retirement or having enough money to enjoy retirement - 54 percent of Millennial men and just 30 percent of Millennial women surveyed say being healthy is the greater concern. Forty-six percent of men and 70 percent of women say having enough money is the greater concern. That means the overwhelming majority of young female workers are already worried about retirement security, even with retirement still 30 to 40 years away.
The retirement planning stressors we hear about from young women include the impact of time spent out of the workforce, financial obligations like student debt, and caring for relatives. Whatever the reason may be, these women, as well as their male peers, can benefit from the financial resources that may already be available to them at work, including professional 401(k) advice and financial wellness programs.
Male and female Millennials alike are open to such help, the survey suggests. Nearly 80 percent of young women and 67 percent of young men want help from a professional in managing their 401(k) investments. Millennials would also like help with specific aspects of retirement planning, like managing current expenses to save more money for retirement and calculating just how much money they'll need to save for retirement.
Professional 401(k) advice can also go a long way towards boosting Millennials' retirement saving confidence, especially for women: only a quarter (26%) of Millennial women feel very or extremely confident in their 401(k) investment decisions when working on their own, compared to 57 percent of Millennial men. With the help of a financial professional, the gap essentially disappears: 76 percent of men and 75 percent of women would feel very or extremely confident with the aid of investment advice.
The other piece of good news for Millennials is that they have time on their side. With retirement still decades away, they have the opportunity to make a plan, form good habits and take advantage of compounding. That is, the more they contribute to a workplace 401(k) plan over a longer period of time, the more potential there is for those investments to grow.
Millennials, if you're having trouble prioritizing your finances with so many competing obligations on your plate, ask for help. If professional advice isn't available as part of your 401(k) plan, you can still take advantage of many online resources available to you. Saving for retirement is a tough task at any age, but you have time on your side when it comes to putting a plan in place.
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*2016 401(k) Participant Survey conducted by Koski Research for Schwab Retirement Plan Services, Inc. Koski Research is not affiliated with Schwab Retirement Plan Services, Inc.
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