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Posted by Dennis Jao

The Biggest Retirement Worries for Women

The Biggest Retirement Worries for Women

As retirement approaches, 60-plus-year-old women often feel financially insecure. Planning for retirement is demanding enough, but women face additional challenges. A longer life, a gender pay gap, and more (on average) free time can make it difficult for women to save for a comfortable retirement, whether single or married. Here are some of the biggest retirement worries for women.


Health costs care for women in retirement.

It's no surprise that more than half (56%) of women aged 60 and over worry about healthcare costs. In addition, 43% fear that the cost of their prescriptions will exceed the savings made for pensions. According to the Top Health and Financial Concerns survey of American seniors, women are more affected than men.

Women can feel the compounding effects of the income gap regarding retirement. Lower incomes often lead to lower retirement account balances. This can lead to much higher rates of financial insecurity for women than for men.

Unfortunately, on average, women earn less than men; their finances suffer even more due to the opportunity costs of being a mother and caring for an elderly parent. Although the balance of household chores has improved over the past decades, the burden still weighs heavily on women.

The NCOA/Ipsos survey conducted between May 29, 2019, and June 14, 2019, among 1,227 adults aged 60 and over revealed the top concerns of women approaching retirement. The rising health care and drug costs and loss of independence are major concerns for seniors and a direct threat to retirement security. Read on for more details on the issues that affect people in their 60s the most.

Sixty-year-old worried about healthcare costs for retirement

  • 56% of Americans age 60 or older (regardless of gender) worry that their healthcare costs will exceed their retirement income

  • 60% of women aged 60 and over fear that their health expenses will exceed their retirement income

  • 68% of Americans age 60 or older with a family income of less than $50,000 are afraid.

Will you be able to pay for your prescriptions when you retire?

  • 43% of Americans age 60 or older (regardless of gender) worry that the cost of prescription drugs will exceed their retirement income

  • 54% of Americans age 60 or older with household income below $50,000 are worried they won't be able to pay for their prescription when they retire.

  • 46% of women aged 60+ worry that the cost of prescription drugs will exceed their retirement income

60-year-old women worry about lack of money

  • 48% of Americans age 60 and older (regardless of gender) worry about outliving their savings

  • 61% of Americans, age 60 or older, with a household under $50,000 are worried that they will lack funds during retirement.

  • 51% of women aged 60+ worry about outliving their savings

At first, it seemed to me that this percentage was surprisingly low, but then I remembered that only 50% of people have money set aside for their retirement. This led me to believe that many people live on Social Security alone. The good thing about this retirement plan is that the Social Security benefits are for life. Assuming the government does not cut them off in an effort to control the budget deficit.

Women are worried about losing their independence as they age.

  • 54% of Americans over 60 (regardless of gender) fear losing their independence, nearly half (46%) fear becoming a burden on their family

  • 59% of women aged 60 and over fear losing their autonomy

Perhaps the lesson here is to work on your health before a crisis hits. Would you rather recover from a heart attack or avoid having one in the first place? Diabetes? Cancer? There is a long list of illnesses of old age that can be minimized or avoided through proper diet and moderate activity. Plus, we're not talking about a crazy exercise regimen or consuming raw cabbage and beets with every meal.


Women are more concerned about becoming a burden on their loved ones

52% of women aged 60 and over are afraid of becoming a burden on their family, 12% more than men

If you have the resources and ability to protect yourself, consider purchasing long-term care coverage for yourself. When purchased as a lifetime benefit under a life insurance policy, you can often get long-term care coverage and the benefits that come with it if you need home care or have a chronic illness. Other benefits may be collected in the event of a heart attack, stroke, or any other critical illness covered by the specific policy.


Sources of income for retirees

67% of respondents say they are fully retired or retired but have a side-paid job (9%). The rest were working before retirement (17%), with a small percentage (2%) reducing part-time work. Only 4% of respondents said they wanted to work for the rest of their life by choice, while 2% expected to work for the rest of their life because they had to do so for financial reasons.

Not surprisingly, Social Security was the most common source of income among respondents (93%). Pensions followed, providing pension income to 49% of respondents. This was closely followed by income from brokerage accounts (43%) or IRA (37%). Only 37% expect to receive income from an employer-sponsored retirement plan, such as a 401(k). Twenty-two percent of respondents intend to use their own capital for required retirement income, 13% for anticipated income from work, and 6% for anticipated income from a rental property.


Conclusion

It is estimated that 10,000 people turn 65 every day in the United States. This means that more people will be forced to deal with their own uncertainties when planning for retirement. As much as you hate to admit it, retirement will come before you know it, regardless of your current age. Take steps to increase your chances of financial freedom and secure retirement. Even if you start your retirement plan at age sixty, there's still time to improve your prospects for a comfortable retirement.


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