Why Single Women Face More Pressure When Saving for Retirement

The pandemic has had a significant impact on relationship statuses, leading to financial ramifications for independent tax filers and wealth builders. With the highest level of single adult women in the US recorded in 2022, it is crucial to understand the unique challenges they face when saving for retirement.

This article explores the reasons why single women face more pressure when saving for retirement and offers actionable tips for addressing these challenges.

The Impact of the Pandemic on Relationship Statuses

The pandemic has dramatically impacted relationship statuses, leading to a rise in single women. In 2022, there were 43.5 million single adult women in the US, the highest level ever and up from 37 million just a decade earlier.

This shift has significant financial implications for independent tax filers and wealth builders.

The Gender Pay Gap and Caregiving

Women earn less than men on average during their working years, with data indicating that women are paid about 80 cents for every dollar men earn.

Additionally, women are more likely to take time away from their careers to care for children or aging adults. This time away from the workforce contributes to lower savings and a smaller Social Security check in retirement.

Lower Retirement Accounts and Longer Life Expectancy

A quarter of single women do not have retirement accounts, and the average Social Security benefits for women are significantly lower than those for men. Furthermore, women tend to live longer on average, requiring more financial resources to support their retirement.

Strategies for Single Women

To overcome these challenges, single women should consider the following strategies:

1. Boost Your Financial Acumen: Improve your understanding of financial matters and make savvy financial decisions to set yourself up for success in retirement.
2. Prepare for the Unforeseen: Establish an emergency fund and ensure adequate income replacement disability coverage and long-term care insurance.
3. Reevaluate Your Expenses: Review your spending and make adjustments to align with your values and financial goals.
4. Shore Up Your Investments: Seek professional advice and consider guaranteed income solutions to alleviate retirement risks.
5. Protect Your Best Interests: Ensure that your beneficiaries on insurance policies, bank accounts, and retirement accounts are up-to-date.

Conclusion

Single women face unique challenges when saving for retirement, including the gender pay gap, caregiving responsibilities, and longer life expectancy.

By understanding these challenges and implementing the strategies outlined in this article, single women can improve their chances of achieving a comfortable retirement.

How can employers and financial advisors better support single women in their retirement planning and savings efforts?