3 Strikes Against Women in Retirement
Saving and planning for retirement is tough enough, in general, but the deck is stacked against women in three important, but not insurmountable, ways.


More than 6 in 10 Americans don’t know how much money they’ll need to retire, a recent Bankrate.com study found. While Millennials are the most likely to be perplexed (69%), this isn’t just a problem for the young: Nearly 60% of Baby Boomers weren’t sure how much money they need to save to successfully retire.
A few years back, a client, whom I’ll call Emily, came to me wanting to know if she could retire at age 65. She had some savings and an inheritance from her father but was still paying off a large mortgage. She worked in a government job and would have a pension, even though she’d started the job in her 50s. But her work was stressful, and she was really looking forward to retiring. The question remained: Could she?
Many women face this decision. They desire to retire because work has become burdensome, or their spouse is retiring, and they’d like to retire together. It’s critical to understand how retirement affects your finances, because running out of money is a concern. To help a client plan for retirement, the main areas we look at are:
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.

Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
1. Age and life expectancy
Women live longer than men, and their health care costs typically are higher. Women are estimated to live up to five years longer than their male counterparts, which means life will be more expensive. Women also represent 70% of the people in nursing homes.
Despite evidence that women live longer, husbands and wives still tend to enter retirement at the same time, according to a research paper by Nicole Maestas, a professor of health care policy at Harvard Medical School. Her research also showed women tend to marry older men and, as a result, women typically enter retirement two to three years younger than their spouses.
2. The amount saved for retirement right now
Women tend to save less for retirement than men do. There are many reasons why women don’t save as much as their male counterparts, but it’s possible they don’t prioritize saving due to budget constraints. A Willis Towers Watson survey found that although men and women acknowledge it’s important to save for retirement, women are not placing as high a priority on setting the dollars aside.
Women ranked “saving for retirement�� as the fifth-highest priority. It fell under “meeting daily living costs” and “paying off debt.” The survey suggested most men and women prioritize other financial needs ahead of their own retirement.
3. The value of Social Security and pensions
The average Social Security check for a woman is $375.81 less than the average man’s. Aside from the well-documented wage gap, women often leave the workforce to care for children and elderly parents. Taking family leave directly impacts a woman’s earnings. Studies have shown that a woman’s pay drops after the birth of her first child.
The amount you’ll receive from Social Security is a calculation based on your 35 highest earning years. If the years that women spend caring for family members result in reduced earnings or even zeros, because they worked less than 35 years, then their Social Security benefits will be smaller.
You can check your estimated benefit by visiting Social Security’s website. Workers over the age of 18 can create an account and check their Social Security statement at any time, which is a good practice to ensure your earnings are being reported correctly.
Good News and Bad News for Emily
How can you know when to retire? And what happened to Emily?
A comprehensive financial plan can help answer this question. Based on the three areas identified above, we find the probability that you’ll be able to afford the payments you can predict, like a mortgage or travel budget. Then we’ll figure out how much more you need to save for the lifestyle you want to lead.
In the end, we determined that Emily could retire with a high probability of success if she worked two additional years, retiring at age 67 instead of 65. A complete analysis of her Social Security benefits showed what her benefit would be if she worked longer. The same applied to her pension, which grew from a few additional years of working. Continuing to work meant her investment portfolio could be positioned to grow rather than taking money out for living expenses. In addition, we provided a cash flow analysis and schedule detailing how to withdraw funds for retirement.
The study by Professor Maestas also found that returning to work beyond midlife was more beneficial for married women than married men. The potential gain in Social Security benefits could be great enough for married women and men to equalize at age 70.
The Bottom Line for Women
If this isn’t the analysis you were hoping to read, keep in mind our retirement was a system built when the average life expectancy was 61. Consider consulting or other work that uses your advanced skill-set to contribute to your household budget. This move won’t continue to feed your employer pension or 401(k), but it could help you defer taking Social Security until age 70. You should always talk to a fiduciary financial planner to ensure your benefits won’t be affected before making a career change.
Advanced planning is key to a successful transition from the wealth-accumulation phase to the spending phase. A financial planner can help you forecast your ability to live comfortably and put your mind at ease over these questions.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

I'm the CEO of Better Money Decisions (B$D) and co-author of the blog Better Financial Decisions. As a principal of B$D, I'm excited to continue my long career as an investment professional. Living and working in places as diverse as Saudi Arabia and Budapest, Hungary, has given me a unique perspective on the world of investing. My book, "Bozos, Monsters and Whiz-Bangs: Bad Advice from Financial Advisors and How to Avoid It!" is an insider's guide to finding the right adviser.
-
New Trump Tax Bill: Five Changes Homeowners Need to Know Now
Tax Changes Trump’s new tax legislation is reshaping how tax breaks for homeowners work.
-
The Smart Way to Retire: 13 Habits to Steal From the Wealthy
Check out these practical strategies that anyone can adopt, not just the rich, and get closer to achieving your retirement dreams.
-
I'm a Financial Planning Pro: Do Your Family a Final Favor and Write Them a Love Letter
Specify your preferences in this personal document that shares your wishes on how you want to be remembered and celebrated. Your family will thank you for easing an emotional time.
-
The Future of Financial Advice Is Human: Gen Z Trusts Advisers, But AI Skills Matter
Graduates entering the workforce trust human advisers more than AI tools with their financial planning. But AI can still enhance the client/adviser relationship.
-
I'm a Wealth Adviser: If You're a DIY Investor, Don't Make These Five Mistakes
Even though you may feel confident because of easy access to investing information, you may be making mistakes that could compromise your long-term performance. Here's what you should know.
-
Building a Business That Lasts: The Critical Steps to Avoid Blunders
'Another Way' author David Whorton offers advice on how to build an 'evergreen' business that endures by avoiding common pitfalls that can lead to failure.
-
I'm a Financial Pro: Why You Shouldn't Put All Your Eggs in the Company Stock Basket
Limit exposure to your employer's stock, sell it periodically and maintain portfolio diversification to protect your wealth from unexpected events.
-
How Will the One Big Beautiful Bill Shape Your Legacy?
The One Big Beautiful Bill Act removes uncertainty over tax brackets and estate tax. Families should take time to review estate plans to take full advantage.
-
Should You Claim Social Security Early or Late? A Financial Adviser Weighs In
There isn't a wrong age to start claiming Social Security, but there are factors that everyone should consider to avoid leaving money on the table.
-
Three Things Financially Confident People Do, From a Pro Who Knows
If you have any worries about your retirement future, take back control with these three tips.