More than half of Americans are worried
they will outlive their retirement savings, and research shows that women
are more at risk of outliving their savings than men. According to the World
Economic Forum, many American women will live more than 10
years past the end of their savings, compared to 8 years for men.
There is a significant shortfall between the savings amounts
women have compared to men. One reason is women, on average, live longer than
men. However, gender income disparity is another significant factor. For
example, according to the U.S. Bureau of Labor
Statistics, in the first quarter of 2022, women who were full-time wage and
salary workers had median weekly earnings of $937, which is 84 percent of the $1,118
median salary men earn.
Many people expect their Social Security benefits to provide
most of their retirement income. That benefit is based on a person's 35 highest
earnings years. The fewer years you spend in the workforce, the less you will
receive in Social Security benefits. Since women are more likely than men to take
time out of the labor force to care for children and elderly parents, those
years without a paycheck will count as zero in their Social Security benefit
calculation.
Women and men also differ in the way they save, invest, and use
credit. Studies show that although women tend to save more than men and are more
likely to pay off their credit card balance each month rather than carrying
a balance, they gravitate toward more conservative, lower-risk investment
options.
Investing time into improving your financial literacy can help
you make sound financial decisions for the future.