The next time you plan on communicating with your staff about the benefits of your retirement plan, it may make sense to put a heavier emphasis on trying to get female workers to ramp up their savings.
New research from ING shows female employees have fallen well behind their male counterparts when it comes to saving for retirement.
How far behind? Here are some eye-opening stats from the ING Retirement Research Institute:
- Among those who have started saving for retirement, men have saved $41,000 more on average than women ($149,000 versus $108,000).
- Women with children have $61,000 less in retirement savings than men
- When it comes to salary deferrals to 401(k)-type plans, more women are in the lower savings bracket (those contributing just 1% to 5% of salary) than men — 42% of women contribute just 1% to 5% of their salary to retirement plans versus 34% of men, and
- Fewer women (25%) than men (33%) have a formal investment plan to reach their retirement goals.
Result: 56% of women do not feel financially prepared for retirement, compared to 42% of men.
These numbers are even more troubling when considering the fact that, on average, women live 8% longer than men (about five years) – and spend more on health care as a result.
ING said the pay gap between men and women isn’t entirely to blame for the difference in savings.
But ING did acknowledge mothers face additional hurdles than men when it comes to building savings.
Example: Mothers tend to spend more time out of the workforce due to caregiver responsibilities, reducing their earning potential.
Info: ING’s research was conducted by surveying 4,050 adults between the ages of 25 and 69 who are employed full-time with an annual household income of $40,000 or greater.