Turning Up the Volume on Gender-Specific Retirement Savings Challenges

  • Fewer women than men participate in workplace savings plans. When they do participate, they contribute at lower rates and take on less risk. 
  • It's time to turn up the volume on the specific challenges women can encounter inpersonal finance and retirement savings. 
  • We advocate 4 strategies as part of the solution.

Over the past year, rising above the daily din of everyday news and events has been this powerful movement of women sharing with one another their collective stories, support and inspiration. These conversations have been hard, at times even uncomfortable, but have also empowered groups of women to take action by standing up to challenges and seeking new opportunities. Today there are more women graduating from college,running for political office, and assuming the role of breadwinner1 for the household than ever before.

Margaret Mead once said, “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has. ”In recognitionof International Women’s Day, celebrated this year on March 8th, State Street Global Advisors wants to honor how far women have come, while acknowledging there is still work to be done in many areas, especially around personal finances, and retirement savings.

Tackling the retirement savings gender gap

Everyone needs to save for retirement, so this may not seem like a particularly gender-sensitive issue. Yet the facts prove that when it comes to retirement savings, the disparity between men and women is significant.

Many interrelated issues feed the savings gap. Societal forces, such as pay inequity and the caretaking responsibilities that disproportionately fall to women, hurt women’s earning and saving power.2 Fewer women than men participate in workplace savings plans. When they do participate, they contribute at lower rates and take on less risk with their investments.3 At the same time, women need to save 28% more than men to cover the additional retirement costs that stem from their longer lifespans.4

28% is how much more women need to save than men to cover the additional retirement costs that stem from their longer lifespans. Fewer women than men participate in workplace savings plans, and when they do participate, they contribute at lower rates.

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Taking Action

The last year has illustrated the tremendous impact that women can have when we raise our voices together, support, and learn from one another. What if we marshalled that collective power to bridge the retirement savings gap? Here are four strategies that could help:

1. Plan Through Design

When offered a workplace retirement plan, women participate less and contribute less than men.4 Plan design remains the best approach for correcting this gap. Ongoing adoption of auto programs such as auto-enrollment and auto-escalation are instrumental in levelling the playing field. Equally as important is the Qualified Default Investment Alternative (QDIA) that plan participants are enrolled in—making sure the risk level is appropriate for the participant’s goals and target retirement date. Consider setting an aggressive starting deferral rate and raising the cap on the auto-escalation feature. To address increased longevity issues, plan sponsors should consider lifetime income solutions that could aid women at times when they need it most.5

2. Provide Targeted Education and Tools for Millennial Women

One third of millennial women are overextended when it comes to their day-to-day finances.6 This prevents them from starting early and taking advantage of the power of compounding. Financial education around debt and budgeting can help, but should be delivered in a relaxed format that allows for exploration and discovery. Consider “class-like”projects, such as the informal interviews of peers and/or the creation and sharing of podcasts, as ways to deliver education in a very interactive manner.

3. Deploy Targeted Campaigns for Women on Managing Risk

Women tend to invest more conservatively than men, however they do take a long-term approach and are less likely to move their money during turbulent times.7 The behavioral patterns of less accumulation and more exposure to risk can lead to a significant deficit. To modify these broad-based behaviors, create targeted campaigns that demonstrate the impact of different investment decisions and the ways in which women can take charge of their retirement savings. Alongside a foundation of robust default funds, such campaigns can work to provide helpful guide rails for managing investment risk.

4. Incorporate Workplace Financial Education and Peer-to-Peer Learning

A recent study conducted by the Center for Retirement Research at Boston College showed that “workplace financial education increased budgeting and saving, particularly among women.”8 Creating environments that encourage social learning, and communications that tell a story, enhance information retention, particularly for women.9 Therefore, consider a narrative-based financial education format that is supported, but not led by, charts and statistics.

Remember too that scare tactics are ineffective: State Street Global Advisor’s 2017 Gender, Age & Pension Savings (GAPS) research, conducted in London, has shown that women and men both respond better to positive messages. Keep the focus on the benefits of saving, not the risks of not saving enough.10 Consider prioritizing sessions that allow for face-to-face contact, such as lunch-and-learn seminars, over impersonal forums such as online learning modules.

Forging Ahead, Together

In the same way that saving for retirement should be a common experience for men and women, so too should be championing retirement savings equality. Bridging the gender savings gap will take time, but a consistent and collective commitment from policy makers, employers, and employees will make a meaningful difference. By standing up and working together, we can stress the importance of the female retirement savings experience on the broader marketplace. We can also empower women to work towards brighter, more secure futures.


1 Pew Research Center, Social and Demographic Trends, “The American Family”, 2015 http://www.pewsocialtrendsorg/2015/12/17/1-the-american-family-today/#mothers-moving-into-the-workforce

2 National Alliance for Caregiving, “Caregiving in the U.S.: A Focused Look at Those Caring for the 50+,” 2009.

3 Financial Finesse, “The Gender Gap in Retirement Savings: Why It’s Important and What Employers Can Do”, 2016.

4 TransAmerica Center for Retirement Studies, “17 Facts About Women’s Retirement Outlook”, 2017.

5 Guaranteed income is subject to the claims-paying ability of the issuing insurance company.

6 Financial Finesse, “The Gender Gap in Retirement Savings: Why It’s Important and What Employers Can Do,” 2016.

7 Wall Street Journal, “Male Investors vs. Female Investors,”2015.

8 Center for Retirement Research at Boston College, “Can Knowledge empower women to save more for retirement?”, September 2017

9, “Harnessing the Power of Stories.”

10 SSGA, “Gender, Age & Pension Savings,” November 2017


Default Investment Vehicles

Investments used by plan sponsors as the default for any participant whom they have automatically enrolled in a retirement savings plan.

Defined Contribution Plan

An employer-sponsored retirement plan whereby employees make contributions to accumulate wealth during their working years to provide income in retirement. Often times, an employer will match an employee’s contribution, up to a certain amount.


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Exp:July31, 2020