A new study by the MetLife Mature Market Institute revealed that women who take an active role in their retirement planning stand a better chance of securing their finances in retirement than those who avoid the process.
"The MetLife Study of Women, Retirement, and the Extra-Long Life: Implications for Planning" examined how women between age 50 and 70 think about retirement. According to the report, women expect to live past the age of 85 and are "more concerned than men about affording health care, long-term care and outliving their assets. Yet, slightly more than half of the women surveyed know the likely amount of their retirement income/assets and only 44 percent have calculated the amount of their essential expenses. Approximately one in six (16 percent) reported that they have or plan to delay retirement, on average, four years."
The data suggest that women who work collaboratively with spouses, partners, financial advisors or even friends report higher confidence in their retirement security.
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"The combination of risks for women and their relatively inadequate retirement planning has become known as the 'perilous paradox,' but the message is clear that women are able to avoid that," said Sandra Timmermann, Ed.D., director of the MetLife Mature Market Institute. "The risks and costs of 'living long and living female' call for an 'affirmative action' plan. We find that those who plan for a steady stream of income, along with some flexibility for the unexpected, are best prepared for what can be an extended future."
Women live 8 percent longer than men on average, which comes with additional costs and financial constraints that can lead to problems with retirement, the report said.
"As of 2009, women age 65-plus had significantly lower annual retirement incomes than men, $21,500 vs. $37,500," the report said. They also are more likely to go through retirement alone, pay more attention to their health, have less adequate insurance and spend money taking care of others who need long-term care. All of this impacts their retirement income, the report found.
The study recommends that women:
- Take Charge. Women who take responsibility for their retirement are in a better position to reduce the specific risks of being female.
- Plan for Contingencies. Have an emergency plan in case you need long-term care or need to cash out of your retirement plan early.
- Do Your Own Math. Knowing what you need and how much you have is key to planning and saving enough for retirement.
- Act Now. Don't wait to make arrangements for your retirement.
The MetLife Mature Market Institute is MetLife's center of expertise in aging, longevity and the generations and is a recognized thought leader by business, the media, opinion leaders and the public.
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