Women are feeling the most confident about their retirement in two years and yet fewer are making financial preparations, according to a new survey.
Although more women are feeling confident about their retirement, fewer women are making preparations, according to a new survey.
The Ameriprise Financial 2012 New Retirement Mindscape City Pulse survey revealed that women are feeling the most confident about their retirement in two years. A quarter of them report being very confident and 44% feel somewhat confident that they’ll reach their retirement goals.
"It's great to see that women are feeling more confident about their financial future," Suzanna de Baca, vice president of wealth strategies at Ameriprise Financial said in a statement. "These positive sentiments may be attributed to any number of factors, but unless these women's feelings materialize into real financial preparation, they're not necessarily an indicator of how ready women are for retirement."
Despite more confidence only 66% report making any kind of financial preparations, which is down from 72% in 2011. All Americans seem to be doing poorly with saving for retirement with BlackRock reporting a $6.6 trillion gap between what people have saved and what they need. However, according to Ameriprise, this lack of preparation is especially concerning for women, who face unique challenges like lower earning power and more time out of the workforce as a caregiver.
Another challenge women face in retirement is longevity — on average, women outlive men 80 years to 75 years. And while Americans generally worry about outliving their retirement savings, a quarter of women underestimate the number of years they’ll need to tap into their retirement funds. Yet, only 48% of women admit they’re concerned they might outlive their retirement savings.
"Attaching numbers to their lifestyle goals allows women — as well as men or couples — to track their progress over time, which is a key part of any financial plan," de Baca said in the statement.
Women are thinking considerably about what they will be doing during their retirement. More than half (56%) of women are making plans to stay health in retirement, which is slightly higher than the number of men. In this year’s survey a quarter of women said that they are making plans to do meaningful work in retirement, which is up from 17% a year ago. Plus 77% said they’re planning for at least one lifestyle activity.
"Women should continue thinking about how they want to spend their retirement years and emotionally preparing to leave the workforce,” de Baca added. “But while confidence in one's ability to reach retirement goals is crucial, it should be supported by both emotional and financial preparation."