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Layin’ It on the Line: Addressing the unique retirement planning needs of women

By Staff | Nov 21, 2023

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Lyle Boss

The landscape of retirement planning presents unique challenges for women. Due to longer life expectancies, intermittent career patterns due to caregiving responsibilities and the persistent wage gap, women must approach retirement planning with strategies tailored to their specific financial and lifestyle needs. This article delves into the various facets of retirement planning that are uniquely pertinent to women, offering insights on navigating these challenges effectively.

The longevity factor

Statistically, women live longer than men, often requiring their retirement savings to last longer. This longevity necessitates a proactive and robust savings strategy.

  • Key strategy: Women should consider starting their savings journey earlier and aim to allocate a more significant percentage of their income toward retirement funds. This approach helps build a larger nest egg to support a potentially extended retirement period.

Career interruptions and their implications

Women are more likely to experience career breaks, predominantly for caregiving reasons, which can lead to gaps in retirement savings.

  • Adaptive planning: Maintaining momentum in retirement planning is crucial even during these breaks. Flexible retirement plans that allow for varying contribution levels and catch-up contributions when returning to full-time work can help women stay on track.

The wage gap and retirement contributions

The wage gap cannot be ignored when discussing retirement planning for women. Earning less than their male counterparts, women face the challenge of having less disposable income to contribute toward retirement.

  • Proactive measures: Combatting this issue requires a two-pronged approach — enhancing one’s financial literacy to make informed investment decisions and advocating for fair pay. Exploring diverse investment options to increase returns on smaller savings is also beneficial.

Investment strategies: Finding balance

A cautious approach to investing may seem safe, but it can result in missed opportunities for growth. Women should seek a balance between caution and calculated risk to ensure their investment portfolios are well-positioned for growth over time.

Social Security benefits: A strategic asset

Given that Social Security benefits are based on an individual’s 35 highest-earning years, women often receive less due to lower lifetime earnings and time out of the workforce.

  • Strategic claiming: Delaying Social Security benefits until age 70 can significantly increase the monthly payout, which can be a crucial strategy for women who live longer.

Health care costs in retirement

Health care expenses can be a substantial burden in retirement, and women, facing a longer lifespan, are more likely to incur higher health care and long-term care costs.

  • Preparation and insurance: Investing in long-term care insurance and using health savings accounts during one’s working years can buffer these expenses, ensuring that women are not caught off guard by health care costs in their senior years.

The journey to a secure retirement for women should be paved with personalized strategies that account for longer lifespans, the possibility of career breaks, the reality of the wage gap and the potential for higher health care costs. Early planning, higher savings rates, informed investing and strategic use of Social Security benefits are pivotal in creating a retirement plan that ensures women’s stability and peace of mind. By recognizing and addressing these unique factors, women can take control of their financial futures and look forward to a comfortable and secure retirement.

Take control of your financial future today. Begin by assessing your current retirement savings plan and consider how the unique challenges you face as a woman can be turned into opportunities for a secure retirement. Consult with a financial advisor to tailor your retirement strategy to your personal circumstances, and commit to making informed decisions that will empower you financially for years to come.

  • Longevity challenge: Women live longer and should save more to prepare for an extended retirement period.
  • Career breaks: Plan for potential career interruptions by choosing flexible retirement plans and making catch-up contributions.
  • Wage gap issue: Address the wage gap by improving financial literacy, advocating for fair pay and exploring diverse investments.
  • Investment strategy: Aim for a balance between conservative and growth-oriented investments to maximize retirement savings.
  • Social Security tactics: Consider delaying Social Security benefits to increase the payout, especially beneficial due to longer lifespans.
  • Health care planning: Prepare for health care costs with long-term care insurance and health savings accounts.

Lyle Boss, a native Utahn, is a member of Syndicated Columnists, a national organization committed to a fully transparent approach to money management. Boss Financial 955, Chambers St., Suite 250, Ogden, UT 84403. Telephone: 801-475-9400.


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