How Women Can Boost Retirement Savings

Preparing for the financial realities of living longer

As a financial journalist, I have seen far too many statistics showing how many elderly women live in poverty, and how women struggle financially in their ‘golden years.’

Only 53% of women indicated that they had begun saving for retirement, compared with 65% of men, according to the BlackRock U.S. Investor Pulse Study, and women with some retirement savings have accumulated less than half of what men have saved ($34,900 vs. $76,800).

Financial expert Joshua Mellberg, president and founder of J.D. Mellberg Financial  investment advisory firm, recommends the following tips for women in order to help them create a financially secure retirement.

His recommendations for women planning for retirement include:

  • Understand Social Security options. Generally speaking, single women are better off if they can delay filing for Social Security until they are 70, when they receive a larger monthly check than they would get at their full retirement age, which is about 66 or 67 for most people these days. Filing before your full retirement age results in a reduced benefit. But if you’re married, additional factors come into play and decisions about when to file for Social Security should be handled jointly with a spouse to get the maximum benefit.
  • Educate yourself. Traditionally, many women left the finances up to the husband, but that dynamic clearly doesn’t work. Women need to make sure they are involved in discussions about retirement planning and educate themselves about their investments. Both spouses should participate in discussions with a financial planner because both will benefit from or be harmed by any decisions that come out of those discussions.
  • Start saving early. Clearly, it’s too late for those about to retire, but younger women need to understand they can’t afford to wait. A study by the National Women’s Law Center showed that, because of the gender wage gap, women on average would need to work 11 more years than men to earn the same amount of money over a working career. That would mean 11 more years of saving as well. That’s why it’s even more imperative for women than for men to start saving for retirement as early as possible.

“Anyone with concerns about retirement should sit down with a financial planner to review your finances and look at options,” Mellberg says. “Having a good plan in place can go a long way in reducing any stress you feel about the future.”