Single women trailing married counterparts when it comes to retirement, EBRI says

Unmarried women workers lack the retirement confidence — not to mention the income and assets — of their married counterparts, according to a new study.

The latest report from the Employee Benefit Research Institute offers a significant wake-up call when it comes to single female employees and their retirement prospects. Not only does it show that single women have fewer financial resources than married ones, but it reveals that unmarried female retirees are more likely to say that their expenses are higher than they expected.

Digging into the survey, just 27% of married women workers have assets of less than $25,000, compared with just over half of divorced women workers (58%) and single, never-married women workers (56%). Married women retirees are also likely to have higher levels of assets than divorced and widowed retirees, according to the study.

Furthermore, married women workers are generally more confident in their ability to live comfortably throughout their retirement years than both divorced and single, never-married women workers. That confidence carries over to their outlooks on managing their day-to-day finances, which also exceeds that of single, never-married female workers. Along those lines, married women workers are more likely to say they’ve done a “retirement needs calculation” than divorced or single, never-married women workers

Both divorced and single, never-married female employees are more likely to acknowledge that retirement savings isn’t a priority relative to current needs than married women workers.

“I am not surprised to hear that single women trail their married counterparts in savings. In the U.S., tax rates are lower for married couples compared to filing on an individual basis for each, so a single or divorced woman potentially has less after-tax income to set aside for saving,” said Melanie Jones, senior vice president at Evoke Advisors.

On the topic of retirement planning advice, one-third of all the women surveyed — both married and single — either strongly or “somewhat agree” that they don’t know where to go for good financial or retirement planning advice, a number that jumps to 45% for single, never married women.

Jones points out that there’s still a stigma discouraging women from talking about how much they earn and how they invest, which is also not helpful for those seeking advice to improve their financial circumstances.

“I believe divorce can make women less likely to discuss their financial situation with friends,” she added.

“I have encountered single, divorced and widowed women with a lack of experience in financial health, but their confidence is boosted through a carefully designed lifestyle plan with action steps to help them achieve what is important to them. Confidence is enhanced when financial advisers develop strong relationships through meaningful conversations with their clients regardless of gender or marital status,” said Michelle Buria, senior director at Choreo Advisors.

Related Topics: Employee Benefit Research Institute