These key steps can help women bridge the retirement savings gap

Women face a unique set of retirement planning challenges.

Unfortunately, research shows that female workers lag behind their male counterparts.

The good news is that working women have the opportunity to take action now to improve their prospects for a better retirement, according to Catherine Collinson, CEO and President of the Transamerica Institute and the Transamerica Center for Retirement Studies.

“Our research consistently finds action steps that are within reach for most women, and they may even seem somewhat basic,” she said, starting with saving and budgeting. “But a lot of women don’t do them yet.”

Of course, men are also guilty of not taking some of these steps. But women fail to a greater degree, she said.

Working women have less than half of total household retirement savings than men, with an estimated median of $57,000 versus $118,000, a recent report from the Transamerica Center for Retirement Studies found.

Women are less likely than men to have saved $250,000 or more in total household retirement accounts, at 24% versus 35%.

Notably, 24% of women and 14% of men have less than $10,000 in savings or nothing at all. Women are paid 83 cents for every dollar men win. And that gap is even wider for women of color.

“The gender pay gap leads to an even bigger retirement savings gap,” Collinson said.

Additionally, women also face unique challenges when it comes to planning for their years out of work. For one thing, they tend to live longer than men.

They are also more likely to take time off from the labor market to care for children or loved ones. This can lead to reduced retirement savings and possibly lower Social Security benefits depending on their own work history.

For working women, having access to a workplace pension plan is key to increasing their retirement savings.

The available vacancies have reached a record 11.55 million in March, according to the latest government data.

“Employers are looking for talent, so for women who are ready to come back, now is the perfect time to do so,” Collinson said.

Finding a more lucrative position can be a first step toward improving retirement security, especially if there is employer matching on 401(k) contributions.

Certainly, women who have taken on care responsibilities may not be able to work full time. But they may want to consider taking part-time or contract work if they are able. This can help them reduce their need to dip into their savings and pave the way for them to return to the workforce when they’re ready, Collinson said.