retirement planning

How Has the Pandemic Changed Retirement Plans for Women?

Despite the challenges we’ve weathered the past year and a half, here are some ideas to get your retirement strategies back on track.

If you haven’t seen the headlines about the disproportionate economic and career impacts that the COVID-19 pandemic dealt women, you might have been living under a rock for the past year and a half. As some of the biggest impacts from the pandemic fade, women are indeed slowly returning to the workforce, but new data indicates that many are still taking a backseat when it comes to their finances.

Compared to two years ago, women are less likely to consider themselves to be the CFO of their household (41% in 2021 vs. 47% in 2019), and also less likely have primary or equally shared responsibility for managing finances and making financial decisions (84% vs. 90%), according to the Allianz Life 2021 Women, Money and Power Study.* They are also less likely to say they have more earning power than ever before (36% vs. 42%). These are marked declines in a short time frame.

When it comes to retirement planning, the picture isn’t much better. Women say they are focused more on short-term finances, rather than longer-term priorities, such as saving for retirement, with 42% saying, “I can’t even think about saving for retirement right now, I’m just trying to take care of day-to-day expenses.” Additionally, since the pandemic began, over half (51%) say they are paying a lot more attention to what they are saving and spending, but only 35% have put more thought into their retirement plan.

For women who are feeling un-engaged in their finances, and even less so when it comes to retirement planning, it’s not too late to get back on track. Here are a few ideas to put women’s finances top of mind.

Revisit your retirement timeline

All the unknowns of the pandemic made planning for a retirement date (or planning for anything) a real challenge. According to the study, 21% said that the pandemic pushed their retirement plans back, while 18% said it accelerated their plans. If you fall into either of these categories and your plans have changed, that’s OK. The next step would be to see how these changes might pose a risk to your financial plan

If you’ve decided to retire earlier than planned, you may need to temporarily boost the amount you’re putting toward your retirement savings to help close the gap. You’ll also want to check in to make sure that you have a plan to fund those extra years of retirement.

Retiring later than you originally planned, while it may not be the most fun thing to consider, can be an effective way to get your finances back on track because you have more time to save and to earn returns on retirement savings and investments. Of course there are benefits for delaying Social Security payments as well.

Find the right financial professional

While the benefits of working with a financial professional are many, one important factor to consider for women is that it can help them feel more confident and prepared for their financial future. The study showed us that 85% say they feel better able to handle life’s curveballs (hello, global pandemic) by working with a financial professional. Further, 77% of those who currently have a financial professional feel they were able to better adjust to the impacts of the pandemic.

Despite these benefits, almost a third (29%) of women indicate they have never used a financial professional, but would consider using one in the future, and only 26% say they are currently working with one.

If you don’t already have a financial professional, speak with friends and family (particularly other women) who can recommend a financial professional they like and trust. Sometimes word of mouth is the best referral.

Playing catch-up

For the 42% of women who say they aren’t even thinking about retirement, or those who have hit pause on saving or may have quit or lost a job with a 401(k) match program, it’s important to start saving again in any amount you can. Any contributions you can make will help you catch up, and when you look at the bigger picture with investments compounding, you’ll feel better about putting even the smallest amounts away.

You can also consider revisiting your risk tolerance with the help of a financial professional to help you explore the potential for higher returns and make up lost ground.

Making the most of it

The pandemic upended so many aspects of everyone’s lives, and put years of financial progress for women at risk. Despite these challenges, remember that retirement planning can’t go to the wayside any longer. Now is the time for women to get engaged with their finances again, and play a proactive role in managing risks to their retirement security.

* The Allianz Life Women, Money, and Power Study was commissioned by Allianz Life Insurance Company of North America via an online survey in May 2021 with a nationally representative sample of 900 women, ages 18+.

About the Author

Kelly LaVigne, J.D.

Vice President, Advanced Markets, Allianz Life

Kelly LaVigne is vice president of advanced markets for Allianz Life Insurance Co., where he is responsible for the development of programs that assist financial professionals in serving clients with retirement, estate planning and tax-related strategies.

Most Popular

Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
The 25 Cheapest U.S. Cities to Live In
places to live

The 25 Cheapest U.S. Cities to Live In

Take a look at our list of American cities with the lowest costs of living. Is one of the cheapest cities in the U.S. right for you?
October 13, 2021
15 U.S. Cities With the Highest Average Home Prices
real estate

15 U.S. Cities With the Highest Average Home Prices

Home prices have rocketed higher across most of the country, but housing costs are acutely painful in these 15 U.S. cities.
October 20, 2021

Recommended

Is Your Home as Protected as You Think? It’s Time for a Policy Review
home insurance

Is Your Home as Protected as You Think? It’s Time for a Policy Review

It’s better to find out your coverage falls short before something happens rather than after. Here’s how to get started and what to look for as you re…
October 27, 2021
Annuities: How to Turn Retirement Savings into Retirement Income
annuities

Annuities: How to Turn Retirement Savings into Retirement Income

An income annuity can convert your savings or a pension-plan lump sum into a lifetime stream of income. Here are the basics on how annuities work and …
October 27, 2021
Boost Your Retirement Savings for 2022
Financial Planning

Boost Your Retirement Savings for 2022

If you were self-employed or had a side hustle in 2021, you can save even more in a tax-advantaged account.
October 26, 2021
Don't Get Too Hung Up on a Retirement Savings Number
retirement planning

Don't Get Too Hung Up on a Retirement Savings Number

There's tons of advice about how big your nest egg should be for retirement but focusing too much on a single figure can lead to complacency.
October 26, 2021