<h1>Women tend to face a few special challenges when saving for retirement. But with some careful planning and smart strategies, they can overcome whatever obstacles may come their way and get their retirement savings on track.</h1>Let's look at a few of the biggest reasons women sometimes encounter extra difficulties in building a retirement nest egg – and how they can save and invest for a prosperous future. &nbsp;<h2 style="text-align:center;" id="reason-1-the-gender-wage-gap">Reason #1: The Gender Wage Gap</h2>It's an unfortunate reality of the working world: Women tend to get paid less than men throughout their careers. According to data from the Pew Research Center, as of 2024, women in the U.S. earned an average of 85% of what men earned.1 This gender wage gap can add up to a significant difference in retirement savings. A study from the U.S. Census Bureau found that 50% of women ages 55-66 have no retirement savings, compared to only 47% of men. And while 30% of men in that age group have built up retirement savings of $100,000 or more, only 22% of women have.2It's no wonder that many women end up with inadequate retirement savings and may be less likely to build substantial wealth throughout their working lives.How to overcome this challenge: Make sure you participate in your employer's retirement plan (if you have one). According to data from the Department of Labor, only 47% of working women participate in such plans.3<h3 style="text-align:center;">"The first and most important thing women can do to boost your retirement savings is to understand your retirement plan options. If your employer offers a retirement plan, such as a 401(k) or a pension plan, make sure you understand how it works, including the contribution limits, investment options, and any employer matching contributions."</h3>– Baruch Silvermann, CEO at The Smart Investor, a financial education websiteEven if your employer doesn't offer a 401(k) or other type of employer-sponsored retirement plan, you still might be able to contribute to a traditional <a href="https://prd.firsthorizon.com/wealth-management/corporate-retirement-plan-services">Individual Retirement Account (IRA) or Roth IRA</a>. Don't assume that future Social Security benefits will be enough for you to live comfortably in retirement.Take advantage of today's opportunities to save and invest via an employer-sponsored, tax-advantaged retirement plan. Set up automatic transfers from every paycheck and put your savings on autopilot. Over time, your retirement nest egg will grow.<h2 style="text-align:center;" id="reason-2-women-are-more-likely-to-leave-careers-to-care-for-family">Reason #2: Women Are More Likely to Leave Careers to Care for Family</h2>Another big challenge to women's retirement savings is that they are more likely than men to leave paid employment to become unpaid caregivers to their loved ones – whether that's raising children or caring for older adult relatives.4 The National Council on Aging found that more than 2 million women left the workforce due to the COVID-19 pandemic in 2020, and U.S. households lose approximately $31.9 billion in wages per year due to lack of access to child care, caregiving leave, paid leave and disability leave.5The unpaid work of caring for loved ones can particularly hit women's earning potential hard, especially if they end up caring for aging parents or other older adult relatives during the peak earning years of their careers.How to overcome this challenge: Plan ahead for caregiving and get access to workplace resources or other support. This is especially important for the costs and complexities of helping aging relatives.<h3 style="text-align:center;">"For many families, eldercare is a matter of 'when,' not 'if' you will need someone to take time away from work. When an eldercare event lands on their lap, and Grandma, Mom, or Dad needs help right now, women go so far as to quit their jobs before thinking through the long-term consequences."</h3>– Joy Loverde, author, speaker and <a href="https://elderindustry.com/">expert on family caregiving</a>Before taking a long-term hit to your financial stability, communicate expectations with your family and get informed about your options for how to manage the financial impact of caregiving."Women must ask themselves several key questions, including: how can I get paid for caregiving?" says Loverde. "What is a financial arrangement I can make with my elders to allow me to afford this role? What eldercare benefits are available through my employer, and how can I tap into any extra help before a crisis occurs?"<h2 style="text-align:center;" id="reason-3-cultural-and-emotional-baggage-around-money">Reason #3: Cultural and Emotional Baggage Around Money</h2>Veronica Grant is a certified financial consultant through the National Financial Educators Council who helps coach women about money issues. She often hears from women who feel a sense of avoidance around money, or who don't know where to begin."Many women are socially conditioned to think that talking about money or wanting more money is taboo or greedy, so they don't," Veronica explains. "This leaves them less financially educated and unaware of what their male counterparts are paid. These cultural taboos can create beliefs among women that they're not good with money or they're not 'rich,' so investing or learning about money isn't for them."Women might need a bit more encouragement, empowerment, and coaching on money management skills, so they can move past these negative cultural messages. Financial literacy is not just for the affluent. People of all ages and income levels – men and women – can improve their financial lives with better education and advice.How to overcome this challenge: Take control of your financial literacy. There are excellent resources available, often for free, to help you get up to speed on financial wellness, saving, investing and <a href="/learning-center/wealth-insights/bridging-the-gender-divide-in-wealth-management">wealth management</a>. Many banks and financial advisory services offer free financial wellness information, webinars, and other resources for retirement readiness.<h2 style="text-align:center;" id="reason-4-women-need-to-invest-for-a-long-time-horizon">Reason #4: Women Need to Invest for a Long Time Horizon</h2>Women tend to live longer than men, and so their retirement savings need to last longer. Based on recent data from the Department of Labor, a woman who retires at age 65 is likely to live for another 21 years (until age 86).6 If you are saving and investing for retirement, as a woman who can expect to live to age 86 or longer, depending on your age and investing time horizon, you should consider investing your money in a way that can maximize long-term growth.A recent Brookings Institution study shows that women tend to be more risk-averse investors than men.7 This risk-aversion can be a good thing if it helps women avoid costly investing mistakes. But if women invest too conservatively for their longer-term time horizon (with too much money in cash or bonds, instead of stocks), this might hurt their retirement prospects."Women tend to have longer lifespans than men, which means that they may need to stretch their retirement savings over a longer period of time, making conservative investments seem like a safer option," says Sophia Jones, financial analyst at <a href="https://piggybank.ca/">PiggyBank</a>, a Canadian personal finance website. "However, investing too conservatively can limit the potential for growth and may result in women not having enough money saved for retirement."How to overcome this challenge: There's no one right answer for how to judge your risk tolerance as an investor. But in general, people who still have 20 or 30 years until retirement age need to have a larger percentage of their retirement savings invested in stocks, instead of a large percentage of cash or low-interest bonds.Working with a financial advisor can help you evaluate your risk tolerance and decide how to invest your retirement savings with an appropriate asset allocation. But beyond the question of how much money to invest in stocks vs. bonds or cash, financial advisors can also help individuals regardless of gender take control of their financial future, save more money for retirement (however long that may be), and be better prepared to meet their long-term financial goals at any stage of life.<h3 style="text-align:center;">Take control of your financial future: Connect now with a First Horizon Advisor.</h3><a href="/wealth-management/investment-services/talk-to-a-financial-advisor">Talk to an Advisor</a><a href="/wealth-management">Learn More About Wealth Management</a>1 Pew Research Center. "<a href="https://www.pewresearch.org/short-reads/2023/03/01/gender-pay-gap-facts/">Gender pay gap in U.S. hasn't changed much in two decades</a>." Accessed May 2023. 2 United States Census Bureau. "<a href="https://www.census.gov/library/stories/2022/01/women-more-likely-than-men-to-have-no-retirement-savings.html">Women More Likely Than Men to Have No Retirement Savings</a>." Accessed May 2023. 3 United States Department of Labor. "<a href="https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-activities/resource-center/publications/women-and-retirement-savings.pdf">Women and Retirement Savings</a>." Accessed May 2023. 4 AARP. "<a href="https://blog.aarp.org/fighting-for-you/paid-leave-women-workforce-caregiving">Paid Leave Helps Women Keep Working, AARP Tells Lawmakers</a>." Accessed May 2023. 5 National Council on Aging. "<a href="https://www.ncoa.org/article/caregiving-equity-better-for-women-better-for-us-all">Caregiving Equity: Better for Women, Better for Us All</a>." Accessed May 2023.&nbsp; 6 United States Department of Labor. "<a href="https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-activities/resource-center/publications/women-and-retirement-savings.pdf">Women and Retirement Savings</a>." Accessed March 2025. 7 The Brookings Institution. "<a href="https://www.brookings.edu/essay/how-does-gender-equality-affect-women-in-retirement/">How does gender equality affect women in retirement?</a>" Accessed May 2023.

Top 4 Reasons Women Need to Save More for Retirement

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Top 4 Reasons Women Need to Save More for Retirement