Women on the 'wrong track' for retirement? Most want a 'pension-like income stream'
Nine out of 10 women said they would be at least somewhat likely to roll over their money into an in-plan protected retirement solution if it was offered to them, according to a new Nationwide Retirement Institute study.
Nearly half of all Americans worry about their retirement savings and whether they might outlive the funds they’ve set aside. When it comes to women, the fears surrounding retirement savings and the economy are much worse.
A new Nationwide Retirement Institute study found that a quarter of working women fear they’re on the “wrong track” for retirement compared to just 15% of men. Many women say they face more challenges than men when it comes to saving for retirement.
Additionally, the study found that women are more likely to hold a more negative outlook on retirement planning than men; 41% of women said they feel neutral or negatively about retirement planning, compared to just 29% of men. The disparity is likely the result of women being less likely to have reached key savings milestones such as contributing to an emergency fund or adjusting their retirement investment allocations.
When it comes to fears of a recession or market volatility, the study found that women are far more likely than men to be worried about an economic downtown impacting their retirement savings.
“Women are actively participating in their employer-sponsored retirement plans alongside their male counterparts, but they’re also facing a variety of challenges that can make navigating their retirement journey more complex,” said Cathy Marasco, leader of Protected Retirement for Nationwide Retirement Solutions.
One major fear for women in the workplace is outliving the funds they’ve set aside for retirement. According to the study, more than half of women are concerned about outliving their income in retirement. Although women are more likely to live longer in retirement, only 13% have diversified their investment portfolio and only 15% looked for investment options that would safeguard their savings in times of economic uncertainty.
The study found that 60% of women struggle with determining how long they will need their savings to last. And only 11% have created a plan to convert their savings into income in retirement.
Additionally, the majority of women fear the cost of health care, Social Security not being available when they’re ready to retire and if they will be able to manage expenses and lifestyle choices during retirement.
Related: 7 in 10 women are rethinking retirement: How financial pros can meet the challenge
In response to growing concerns about retirement savings, there is opportunity for new solutions that could help women manage their money and plan for the future.
Three in four women say they wish their 401(k) provided a “pension-like” income stream, according to the study. Additionally, 9 out of 10 women said they would be at least somewhat likely to roll over their money into an in-plan protected retirement solution if it was offered to them.
“Women who participated in our study say a pension-like income stream would reduce their stress, increase their financial security and improve their peace of mind,” said Marasco. “This sentiment aligns with our research showing pension holders are more financially confident and less concerned about outliving their money than those without pensions. It’s time for employers to extend those same benefits to today’s workers by offering a guaranteed lifetime income investment solutions through their qualified employer-sponsored plan.”