The gender pay gap, time out of the workforce for parenting and caregiving, and now the pandemic. Despite many challenges, working women in the US continue to save for retirement. There are steps they can take to improve their financial security.
More than half of working women (51%) in the US say that their financial situation has been negatively impacted by the COVID-19 pandemic. Additionally, 42% of women workers experienced one or more impacts to their employment due to the pandemic. This is according to Life in the COVID-19 Pandemic: Women’s Health, Finances, and Retirement Outlook, a new study released by nonprofit Transamerica Center for Retirement Studies (TCRS) in collaboration with Transamerica Institute.
"Despite progress made in recent decades, women continue to be at greater risk of not achieving a financially secure retirement than men, in large part due to the gender pay gap and time out of the workforce for parenting and caregiving," says Catherine Collinson, CEO and president of Transamerica Institute and TCRS.
Many women have been stretched beyond their limits due to the pressures of balancing work and family amid the pandemic. "Some have given up their employment and dropped out of the workforce altogether," Collinson says.
Nevertheless, the survey finds that working women in the US continue to focus on future retirement plans, with 77% actively saving for retirement. The efforts may not be sufficient for many to enable them to enjoy a comfortable lifestyle in retirement.
"Preparing for retirement involves having a complete picture of your finances and goals. It also requires safeguarding one’s health and employability. The cumulative effect of daily actions and small steps over a long working career can profoundly influence a woman's ability to retire comfortably."
What can women do?
"Preparing for retirement involves having a complete picture of your finances and goals. It also requires safeguarding one’s health and employability. The cumulative effect of daily actions and small steps over a long working career can profoundly influence a woman's ability to retire comfortably," Collinson says.
The survey findings illustrate ways that women can take greater control over their finances and future retirement.
- Create a personal financial plan. Budgeting, prioritizing expenses, setting short- and long-term goals, and developing a retirement strategy are important steps in improving fiscal health
- Be proactive about staying employable by keeping job skills up to date, learn new ones and network more.
- Get into the habit of frequently discussing saving, investing and financial planning for retirement with family and close friends.
- Safeguard your health. Amid the pandemic, it is more important than ever to protect one’s health. many women workers say they are eating healthy (57 percent) and exercising regularly (53 percent), but fewer than half are getting plenty of rest (49 percent), seeking medical attention when needed (44 percent), or managing stress (40 percent).
Women can and must do a lot for themselves, but the responsibility for financial security goes beyond individuals. "While women are doing their part by saving and investing for retirement, concerted actions are also needed from policymakers and employers to address structural issues, bridge inequalities, ensure equal pay and benefits, and ultimately promote their retirement security," Collinson says.