Retirement crisis is coming: Women say Congress, employers should do more
Women earn less than men, often take time away from work for caregiving and live longer, which is why they say Congress needs to shore up Social Security and employers should contribute more to their plans, says a new survey.
“If policymakers are serious about improving the financial resilience of women, they’ll need to implement pragmatic retirement solutions that will help women shore up their retirement position,” said Dan Doonan, executive director of the National Institute on Retirement Security (NIRS). “Women clearly see increasing pension coverage as part of the retirement equation, and they want to see action now on Social Security.”
Eighty percent of women think the nation is headed toward a retirement crisis, according to a new report published by NIRS based on a survey conducted by Greenwald Research. More than three-quarters of women surveyed said they believe the typical American worker doesn’t earn enough to independently save for a secure retirement. Women surveyed largely equate having a pension with retirement security, and 82% said all workers should have one so they can be self-reliant during retirement.
Women face an uphill battle when it comes to retirement, said Doonan. They are less likely to have access to a workplace retirement plan and more likely to face caregiving demands throughout their lifetime, both of which impact their earning potential and ability to save for retirement.
“The wage gap is stubbornly persistent for women and they typically live longer than men,” he said. “Generally, women need a larger nest egg, yet most are in a weaker financial position as compared to men.”
Eighty-one percent of women are worried about the costs of long-term care, and only 38% feel confident they will be able to pay for any needed long-term care costs, the survey found. Most women (86%) agree that the government should do more to help Americans get access to quality long-term care when the need arises.
Women also expect employers to help prepare their employees for retirement security which they say is becoming more difficult due to inflation, rising healthcare costs, debt and a decrease in pensions. Employers should contribute more money to workers’ retirement plans, say 81% of women surveyed.
“Offering women a retirement plan is the first step employers can take to help women build retirement confidence,” said Doonan. “Workers are 15 times more likely to save for retirement if offered a savings plan at work. Whether it’s a defined benefit pension plan or a 401(k) or participation in a state-facilitated auto-IRA program, offering a plan is the crucial first step.”
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Further, offering a company match if possible boosts employees’ retirement savings while making employers more attractive to potential employees, which can be a benefit in today’s tight labor market, he said.
“If the employer is already sponsoring a plan and offering a match, then thinking about next steps like emergency savings vehicles that accompany a retirement savings plan can really set an employer apart while helping women,” said Doonan.