3 Ways Women Can Overcome Gender Disparities In Retirement

The following is a guest post.  This post does not necessarily reflect the views of Suzanne and David E. McClendon, Sr. or Manian Debil Productions.

3 Ways Women Can OvercomeGender Disparities In Retirement

Men and women differ in plenty of ways, so maybe it shouldn’t be a surprise that how they plan for and what they can expect from retirement are different as well.

In short, the average man is in better shape for retirement than the average woman.

For example, men are more likely to save for retirement and to start saving at a younger age, according to a report by the TransAmerica Center for Retirement Studies.

Yet it is women who are going to have the longer retirements because of their lengthier life expectancy. That means women need to be able to stretch their retirement savings out over more years than men do – even if those savings end up being skimpier.

“Women are also more likely than men to spend their final years alone, either because of divorce or because they are widowed,” says Ernie Burns, president and chief executive officer of Burns Estate Planning and Wealth Advisors (www.burnsestateplanning.com).

“Retired married couples often are receiving two Social Security checks and when one spouse dies, one of those checks goes away. Usually, it’s the wife who will be left with a sudden drop in income.”

But Burns says there are a few things women can do to put themselves in a better position to feel more confident as they approach retirement age. Those include:

• Improve your financial literacy. In one recent study, just 18 percent of retirement-age women were able to pass a financial literacy quiz. (That compares to 35 percent of the retirement-age men.) “Women can do something about this,” Burns says. “The more they can learn about retirement planning, the better prepared they will be to handle the potential pitfalls out there.”

• Work longer. Staying in the workforce longer might not be everyone’s retirement goal, but it can pay off in several ways. For example, for women who temporarily left the workforce to raise children, working longer provides more tax years for the government to use to calculate Social Security benefits, Burns says. Those benefits are determined using your 35 highest-earning years. Zeroes are factored in if you didn’t work 35 years. Also, if you can delay drawing Social Security until you are 70, you will receive a larger check each month. Staying on the job also gives you more years to save, and fewer years that you need to spend your savings.

• Take care of yourself. Medical expenses can quickly deplete retirement savings, so maintaining a healthy lifestyle can play a major role in keeping your finances healthy as well. Fidelity Benefits Consulting recently reported that a 65-year-old couple retiring this year would need an average of $275,000 to cover medical expenses in retirement. “Many Americans haven’t saved that much to cover all their retirement expenses combined, much less just the medical expenses,” Burns says. “That’s definitely an area you need to think about and plan for.”

“Whether they are married or not, women need to take an active role in their retirement planning,” Burns says. “There’s a good chance retirement will last 30 years or more. With so much time involved, you don’t want to leave your financial situation to chance.”

About Ernie Burns

Ernie Burns, president and chief executive officer of Burns Estate Planning and Wealth Advisors (www.burnsestateplanning.com), has more than 25 years’ experience in retirement income planning. He is an Investment Adviser Representative, and also is a Master Certified Estate Planner (MCEP) and a Million Dollar Round Table-Top of the Table Member (MDRT). Burns also is host of Total Retirement, a 30-minute television show. He has been published and/or quoted in Fortune Magazine, Entrepreneur Magazine, Money Magazine and Bloomberg BusinessWeek. Burns Estate Planning and Wealth Advisors is now the “Official Wealth Management Firm of Southeastern Athletics” for Southeastern Louisiana University.

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