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Women Facing Poverty in Retirement
Posted on Thursday, February 16, 2012 by Wendy Sudiro
Women are often until retirement with smaller pensions and retirement funds than men. All workers should be saving more for retirement, but women face the added challenges because they have lower earnings, experience higher job turnover and have a longer lifespan. Women generally begin retirement with smaller pensions than their male counterparts, but tend to live longer than men. Social Security is intended to be an additional source of income in retirement, but too many women are forced to rely on it as the sole source of support in retirement. As a result of these issues, older women in the United States have one of the highest poverty rate of any industrialized nation.
Save The women less than men for retirement
Chief among the reasons that women save less than men is that women earn less than men, lower wages equal lower retirement štednju.Jednaka wage law was enacted in 1963 and has almost half a century later, women make only 77 cents for every dollar earned by men . According to the National Women's Law Center, "to insist on wage translates to more than $ 10,000 in lost wages per year for the average female worker."
Equal pay is not just a female problem, it is a family problem. Women make up half the U.S. workforce and mothers are the primary successful or successful associates in nearly two-thirds of American families. Wage discrimination harms many American families, limiting their economic security and now their retirement security in the future.
in April Paycheck Fairness Act was reintroduced in both the House and Senate. This law will help eliminate wage discrimination.
Women have different working patterns
Women have different working patterns. Women typically spend less time in the workforce due to family care-giving responsibilities of raising children (and grandchild) care for elderly parents. Also, women are more likely to work in jobs with part-time job that does not qualify for a retirement plan. Such interruptions mean fewer jobs the opportunity to save for retirement and social security contributions. From the 62 million wage and salaried women (age 21-64) who work in the United States, only 45 percent participate in a retirement plan.
Married women often rely on a spouse saving
It is not uncommon for many married women to rely on their spouse's retirement savings. Under the traditional pension plans, benefits married workers are paid as a life annuity with payments for a spouse. However, in most of the 401 (k) plans, spousal consent is not required for workers seeking distribution. This means that a worker can take a distribution from the plan without the consent of the spouse (or knowledge). Trend 401 (k) plans and away from traditional pension plans contributed to the lack of pension funds for many women.
Women invest more conservatively than men
Studies show that women invest more conservatively than men. Women tend to emphasize safety in return. They often have less to save for retirement, and then to sacrifice long-term growth with low risk investment strategy.
Women need more money for retirement
Women have longer life expectancy than men. Life expectancy for women is now about five years and more than that for men. Thus, women spend more in retirement. For married women, 70% of them will outlive their husbands. Single women (including widows) ages 65 and older rely on Social Security for 50 percent of their total income. Since women tend to live longer than men, they are in greater danger of outliving their other sources of retirement income.
startling statistic
The last Census Bureau data show a significant and alarming increase in poverty and extreme poverty of women, men and children in the United States in 2009. Poverty among women increased to 13.9 percent, up from 13.0 percent in 2008 - the highest rate in 15 years and the largest single year increase since 1980. More than 16.4 million women were living in poverty in 2009, the highest number since the Census began collecting data in 1966.
Changes needed to Close the Gender Gap retirement savings
• Continue to work to eradicate the differences between wages of men and women.
• Increase in pension coverage for lower wages, part-time and temporary workers.
• the provision of social services for the credit-granting Security earning.
• Require approval of marriage for 401 (k) distributions.
• Allow tax-free transfer of pension assets between spouses.
• providing investment education specific to the overly cautious investment strategy chosen by many women.
Finally, the basic saving strategies are the same for men and women: start saving early, as much as they can contribute to your company retirement plan, and not take money from your retirement plan to meet short term needs. However, it is especially important for women to stay focused on saving for retirement as the inequality of wages and working patterns of many women to reduce future pensions.
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