Few women confident about retirement prospects

Just 23% of women in a recently released survey said that they were confident in their ability to retire with a lifestyle that they considered comfortable.
OCT 29, 2007
Just 23% of women in a recently released survey said that they were confident in their ability to retire with a lifestyle that they considered comfortable. That figure has not changed over the past two years, according to the survey, conducted for the Transamerica Center for Retirement Studies, a non-profit organization in Los Angeles. The survey also showed that 42% of women interviewed between July 27 and Oct. 7 of last year said that they were "not sure" how much they needed to save for retirement, up from 27% in 2005 and 11% in 2004. In the latest survey, 45% of the women said they simply "guessed" how much they need to save for retirement, up from 39% in 2005 and 33% in 2004. While women are worried about retirement savings, Catherine Col-lin-son, who is the market trends expert for the center, pointed out that just 27% of the men surveyed said that they were confident in their retirement savings strategies. Harris Interactive Inc. of Roch-ester, N.Y., conducted the survey on behalf of the center. The eighth annual poll surveyed 1,402 employed American adults — of which 687 were women. The center separated the re-sponses by gender to point out that financial advisers need to help women because they "are an underserviced market," Ms. Collinson said. "There are a lot of things that advisers can do to help women better save and plan for retirement," she said. The survey showed that just 22% of women said they had a very good understanding of the principles of asset allocation. And according to a study based on the survey, women tend to invest more conservatively than men, which can also affect retirement savings. Women find it more challenging to save for retirement, because they earn on average about 77% of what men do, with women earning a full-time median annual salary of $31,858, compared with $41,386 for men, according to the analysis. "It's a very personal issue," Ms. Collinson said. "Where advisers can step in is to help run the numbers and help them better understand em-ployee benefits." The survey also showed that 401(k) plan participation rates by women fell to 70% in 2006, from 72% in 2005 and 76% in 2004. Nevertheless, some advisers report that in general, women are more proactive about finances then they have been in the past. "I've got a lot of women clients," said Roger Wohlner, an adviser with Asset Strategy Consultants in Arlington Heights, Ill. "I don't have too many clients who let their husbands do everything financially." And an increasing number of his clients are single women. "One of my longest-tenured clients is a woman who has never been married and is worth $3 million, and has statements that predate T. Rowe Price," Mr. Wohlner said. When a married couple visit her, observes Rebecca Preston, a certified financial planner and the sole proprietor of Preston Financial Planning in Providence, R.I., it is typically the wife who instigated the visit. "I have a lot of couples that have been brought in by the woman," Ms. Preston said. "The woman is often the one who's more in charge with the finances." Ms. Preston also finds that younger women tend to be more prepared for retirement because they began saving earlier. She's noticed that baby boomer women — especially those who have been divorced — are often more anxious. "The single women I have are the ones who are more worried and less prepared," Ms. Preston said. "A lot of them have never been big earners and have taken off long stretches of time for children." Lisa Shidler can be reached at [email protected].

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