Did you know? Women should probably start sooner and save more for retirement than men, given that the average woman is expected to live five years longer than the average man, at least here in the United States.
The good news is that many women have heeded this advice: a new white paper from Vanguard finds that women are 14% more likely than men to participate in workplace-savings plans (e.g., women earning less than $100,000 have a participation rate 20% higher than that of men).
The bad news is that, despite women participating in retirement-saving plans at a higher rate, men still have far greater retirement savings due to higher wages. In Vanguard’s study, men have average account balances 50% higher than that of women’s.
Fidelity has examined the balances of its 13.6 million participants, and found that men have an average 401(k) account balance of $98,700, with women at $67,400. The Fidelity data differed from the Vanguard data in that it found women who earn less than $150,000 have more saved in their retirement accounts than men. This bottom bracket includes women who have been there for a long time.
So while women are better retirement savers than men, they’re not saving more on the whole due to wage disparities. And with women living longer, this means less to live on until the gender pay gap closes.
Source: The Atlantic