Retirement Savings & Gender Inequality: A Looming Crisis
Published on: April 13, 2023
a generation of women sitting on a couch, helping to plan one of their futures with financial tasks for each decade.
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Retirement is meant to be a time of rest and relaxation after years of hard work. However, for many women, retirement is a time of financial struggle and uncertainty. The harsh reality is that the gender pay gap significantly impacts women’s retirement savings, making it challenging for them to retire with the financial security and dignity they deserve. In this blog post, we will explore the impact of the gender pay gap on retirement savings and discuss actionable steps women can take to ensure a comfortable retirement.

The Gender Pay Gap’s Impact on Retirement Savings

The gender pay gap has a significant impact on retirement savings, and women are more likely to live in poverty in their retirement years. According to a report by the National Institute on Retirement Security (NIRS), women are 80% more likely than men to be impoverished at age 65 and older. The report also found that women’s retirement savings are typically one-third less than men’s, and they are less likely to have access to retirement plans. This lack of savings is due in large part to the gender pay gap, which means that women have less money to save for retirement.

Intersectionality and Retirement Savings

Retirement savings are important, but for women, it can be especially tough. Women, especially women of color, often face a significant wage gap and have caregiving responsibilities that make it hard to save. Recent studies show that women are 80% more likely than men to be living in poverty during retirement. African American and Hispanic women are hit the hardest, with poverty rates of 42% and 37%, respectively.

In addition to that, a recent study done by Employee Benefit Research Institute in a collaboration with Greenwald Research found that the percentage of non-LGBTQ Americans being very or somewhat confident in having enough money to live comfortably in retirement increases with income significantly higher than the percentage of LGBTQ Americans in each income group. For example, in the middle-income group, 51 percent of LGBTQ Americans are not confident compared with 29 percent of non-LGBTQ Americans.

These stats make it clear: we need to address intersectionality when it comes to retirement savings. It’s time to make sure everyone, regardless of their gender, race, or sexual orientation, has the resources and support they need to live comfortably in their golden years.


Strategies for Combating the Gender Pay Gap in Retirement

  1. Advocate for pay equity: Encourage policymakers and employers to close the gender pay gap by supporting pay equity legislation and policies, such as the Paycheck Fairness Act.
  2. Invest in your retirement: Start saving for retirement as early as possible and take advantage of employer-sponsored retirement plans, such as 401(k) plans. Be sure to take advantage of these plans and contribute as much as you can.
  3. Negotiate your salary: Women are often paid less because they are less likely to negotiate their salaries and benefits. Know your worth and the value you bring to your employer.
  4. Start saving early: Even small amounts of savings can add up over time. Start saving as early as possible and take advantage of any employer-sponsored retirement plans.

Available Resources

Here are some resources for those that want to learn more about the gender pay gap and retirement savings:

  1. National Women’s Law Center: The NWLC is a nonprofit organization that works to advance gender equality and promote economic security for women.
  2. Women’s Institute for a Secure Retirement (WISER): WISER is a nonprofit organization that provides education and resources on retirement planning for women.
  3. The Wage Project: The Wage Project is a nonprofit organization that provides resources and tools to help women negotiate their salaries.
  4. Ellevest: Ellevest is a financial company that is specifically designed to help women invest and save for retirement.

Women face significant challenges when it comes to retirement savings due to the gender pay gap. However, there are steps we can take to combat this issue. By advocating for pay equity, negotiating our salaries, starting to save early, and investing in ourselves, we can help ensure a more secure retirement.