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Retirement
Security less likely for Women than Men
May 7, 2009, Washington, D.C. – Women remain
at a higher risk for retirement insecurity
as compared to men, according to a new
research brief issued today by the National
Institute on Retirement Security.
That risk can be reduced by ensuring women
have the combination of a traditional
pension, supplemental 401(k)-type individual
savings, and Social Security.
“Shattering
the Retirement Glass Ceiling: Women Need a
Three-Legged Stool,”
examines the specific challenges facing
women in retirement and assesses the
policies that may help increase retirement
security for women.
The research finds achieving retirement
security often is more challenging for women
than men and includes the following key
findings:
·
Women need to accumulate more retirement
assets than men because they often to live
longer. But, acquiring enough assets is more
difficult because women still have lower
wages and less access to retirement plans
during their working years as compared to
men.
·
Defined benefit (DB) pension plans provide
benefits and protections that are especially
important for women – spousal protections
and a lifetime income stream that cannot be
outlived.
·
Supplemental defined contribution (DC)
savings plans like 401(k) accounts offer
portability of assets, which is an important
tool for women who may move in and out of
the workforce more so than men.
·
Attaining the “three-legged retirement
stool” – Social Security, a traditional DB
pension, and supplemental DC savings –
offers the greatest opportunity for women to
achieve security in retirement.
“The data reveal that the retirement gender
gap is alive and strong,” said
Ilana Boivie
, NIRS policy analyst and author of the
research brief.
She added, “Women still earn less, have less
to save, and are less likely to have
workplace retirement plans.
"Our research indicates that women can
shatter that retirement glass ceiling with a
boost from a three-legged retirement
security stool.
"And
given that the global economic crisis has
drastically eroded retirement readiness,
it’s all the more urgent that a policy
framework is put in place to give all women
a shot at achieving retirement security with
a pension, 401(k)-type supplemental savings
accounts, and Social Security.”
The research finds that that a woman with a
salary of $50,000 must save $1,000 more per
year than her male counterpart to achieve
equitable retirement income because of her
longer life expectancy.
"Yet according to a 2007 study, full-time
female workers made just 76.2% of their male
counterparts’ wages – that means less money
for savings.
The study also indicates that women are more
likely to live above the poverty line in
retirement when they have income from
pensions.
But, just 23.3% of women have their own
pension as compared to 42% of men.
Among women dependent on their husband’s
retirement plan, those whose husbands have a
DB plan may be better off than women whose
husbands have only a DC plan, because DB
plans have special protections for spouses.
Additional data and analysis are available
by dowloading the full research
Issue
Brief
here.
Read
Commentary
here.
About NIRS
The National Institute on Retirement
Security is a not-for-profit organization
established to contribute to informed
policymaking by fostering a deep
understanding of the value of retirement
security to employees, employers , and the
economy through national research and
education programs.
Located in Washington, D.C., NIRS seeks to
encourage the development of public policies
that enhance retirement security in America.
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