Although women are more concerned about the potential risks they face in retirement than men, a new study by LIMRA found that fewer women had completed any of the basic retirement-planning activities, such as determining expenses and income, calculating assets, etc. Thirty-two percent of women said they had done no retirement planning.
“We know from earlier studies that working women, on average, have accumulated 40 percent less than men for retirement, which was confirmed again in this study,” says Cecilia Shiner, senior analyst, LIMRA retirement research. “Even though 6 in 10 women are concerned they aren’t saving enough to last throughout their retirement, we see few women taking steps to mitigate for this risk.”
LIMRA found that women were less engaged in retirement and investment activities–only a third of women said they were actively involved in monitoring and managing their retirement savings, compared with nearly half of men (46 percent). Two-thirds of women were not confident that they would be able to live their chosen retirement lifestyle; yet only 26 percent of women spend time investigating financial products that could help them.
Huge knowledge gap in women
“The knowledge gap between men and women continues to be an issue–just 33 percent of women felt they were knowledgeable about financial products and services, compared with 55 percent of men,” notes Shiner. “Our research shows that when consumers feel more knowledgeable about financial products, they are more likely to be engaged. Advisors and companies should be developing new strategies to educate women and increase their engagement level.”
Looking at women who said they were knowledgeable about financial products and services, nearly twice as many (60 percent) were actively involved in monitoring and managing their retirement savings, and more than half of these women were confident that they would be able to achieve the retirement lifestyle they want.
“Engaging and educating women should be a top priority of our industry,” says Alison Salka, LIMRA corporate vice president and director of Retirement Research. “There are approximately 16.6 million women within 10 years of retirement (age 55 to 70 and not yet retired). Our research reveals that many of them are financially unprepared for retirement and because of their lack of knowledge and understanding of our products and services, are not taking the steps to reduce the risk that they run out of money in retirement.”
For more information, visit LIMRA at www.limra.com.