The report explores the different approaches men and women take to retirement, identifies additional challenges women must address, and suggests ways in which they can learn from each other.
"Despite the challenges that women face, we are seeing that they are actually more likely than men to enjoy their retirement," said
Women Face Unique Challenges
The report notes that, for many women, retirement is often lived alone, whether by choice, or as the result of divorce or the death of a spouse.
Women must address unique challenges when planning for retirement such as longer life spans than men, and more intermittent work histories (women are more likely to interrupt their employment to act as family caregiver). These factors may result in lower earnings which, in turn, equate to lower pension benefits or 401(k) balances. Widowhood or divorce can also reduce women's retirement income. Moreover, women are statistically less likely than men to find a new partner if they find themselves alone in retirement.
What the Genders Can Teach Each Other
The behavioral differences exhibited by women and men can have a critical impact on their retirement planning. However, by capitalizing on each other's positive behaviors, which are very complementary, both sexes can better position themselves to have a more successful and fulfilling retirement.
The report found that women, in general, are less confident in their knowledge of finances and financial product/services than men. They also tend to be more risk averse than men, trade less frequently, hold less volatile portfolios and expect lower returns than men do.
Men's willingness to assume a reasonable level of risk allows them to achieve relatively higher growth in their retirement savings. Women could benefit from employing some of these behaviours in their retirement planning efforts.
According to the report, men have a tendency to "go it alone" when formulating plans. Women are more likely than men (43 percent vs. 34 percent) to say they need help, which could help them avoid costly mistakes.
Additionally, men's identities have historically been closely tied to their work. If they have not replaced work with something that gives them a sense of purpose during retirement, it can have negative outcomes. Women, on the other hand, are more closely tied to the relationships they have built nurturing their families and that provides them a sense of purpose that will see them through their retirement.
Ms Di Vito concluded, "There are clear differences between men and women when it comes to retirement planning. However, by integrating the best attributes from one another, both genders can increase their prospects for a more successful retirement."
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