Plan for Tomorrow | Five ways women can plan for retirement
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Five ways women can plan for retirement

Sep 20, 2023, 7:52:30 PM | Reading Time: 5 minutes

Today, women are seeking more ways to empower themselves financially. They could be taking ownership of money matters, seeking to find answers to tough questions, and making smart moves to help them define their financial future. According to 2021 North American research, Empowered – Women and Retirement, women are becoming financial decision makers, taking on the responsibility of managing the majority of all household finances.

Now, more than ever, it’s important for women to harness their financial prowess and create opportunities in retirement.

1. Find expert help

The Empowered survey found that 37% of women cited their financial advisor as a source for learning about retirement. Connecting with a financial professional is a smart way for women to better understand the retirement benefits available to them, such as a 401(k). A financial professional can help by recommending products and services that may address their needs beyond employer-based solutions, and can help implement a sound financial strategy for retirement based on their individual goals.

2. Strategize for healthcare costs

Rising medical costs make healthcare a big concern for all retirees these days. Women typically outlive their male partners by approximately five years according to the Centers for Disease Control and Prevention. That longer lifespan means they have to pay additional healthcare costs. On average women also earn less than men in their working years, which means they receive lower Social Security benefits. Given these obstacles, it can be vital for women to create a strategy to save more for healthcare costs. A health savings account (HSA) offers tax-free contributions and can be used for out-of-pocket expenses. IRAs and fixed index annuities are also options worth exploring.

3.Develop a retirement plan

To fully enjoy retirement it’s important to have a plan in place. The survey found that 43% of female consumers currently have a retirement plan. Another 16% of women are somewhere in the process of planning. This growing focus on organizing and mapping out a path for retirement is an important building block for women looking to take control of their financial future. With 64% of women surveyed indicating that their current plan was at a moderate to strong level, there’s room to develop greater confidence in retirement strategies. To ensure a retirement plan stays on track, it’s important to take a few steps:

  • Calculate how much money you need for retirement – Retirees typically need about 70% to 90% of their pre-retirement income to cover standard living expenses, according to the U.S. Department of Labor.
  • Assess your finances – Continually review income and savings to determine spending and the amount of money needed to meet retirement goals. The best way to do this is to build a budget around estimated retirement expenses.
  • Pay down debt – Making adjustments to expenses can strengthen finances for those planning for retirement.

Creating a retirement plan doesn't have to be daunting. A financial professional can help assess what you have and what you need and can help tailor a plan that works for you.

4. Research social security options

Social Security benefits are based on how long a person has worked, how much she’s earned, and when she starts receiving benefits. Many women face challenging choices in life that can affect their retirement pension. They may choose to work their whole lives, leave the workforce to raise children and then return to a job, or simply decide to stay at home. Other factors like divorce or remarriage can affect how much Social Security money is received as well.

Over the years, the level of Social Security protection for women has strengthened, but it can't cover all financial needs. That's why it's vital to make plans and consider alternative methods for saving money for retirement. Having a plan that doesn’t solely rely on Social Security money to fund a nest egg is something all women should research.

For more about Social Security, read the Social Security Administration document, What Every Woman Should Know.

5. Talk with your partner frequently

When it comes to money, women have different money concerns than men. They often seek security, according to the survey, citing peace of mind, emergencies and health care as the most important reasons to save. Women are also significantly more concerned about saving for emergencies and mortgage or rent expenses than men. These priorities are important when planning long-term goals like retirement, so it’s important that they are honestly discussed with a significant other. Now that the vast majority of women are likely to manage all household finances, that shift should be explored and thought about carefully to ensure that their financial future is secure.

The North American general consumer study, Women and Retirement, was conducted Jan-Feb 2021 and included 622 total respondents, both men and women, age 40 and above. The agent study was conducted Jan.-Feb. 2021, and included 339 contracted agents including both men and women.

The analysis is for educational purposes only. The experience of the participants of the 2021 Study may not be representative of the experience of all. Neither the company, nor any agents acting on its behalf, should be viewed as providing legal, tax or investment advice.

Sammons Financial® is the marketing name for Sammons® Financial Group, Inc.’s member companies, including North American Company for Life and Health Insurance®. Annuities and life insurance are issued by, and product guarantees are solely the responsibility of, North American Company for Life and Health Insurance.

The term financial professional is not intended to imply engagement in an advisory business in which compensation is not related to sales. Financial professionals that are insurance licensed will be paid a commission on the sale of an insurance product.


REV 3/2022