Why Women Can’t Afford to Retire and How Employers Can Help

Women control a vast portion of the nation's wealth, and their financial insecurity ripples through families and communities. A secure retirement for women means greater economic stability for everyone.

This article dives deeper into the factors contributing to women's retirement gap and unveils practical solutions employers can implement to bridge the divide. 

We explore how closing the pay gap, promoting adequate retirement savings, and providing support for caregiving responsibilities can level the playing field and pave the way for a more equitable retirement landscape for all.

Closing the Retirement Gap

The statistics paint a chilling picture. Women retire with significantly less income than men: only 70% on average, with older women disproportionately facing poverty¹. This gap stems from a complex web of factors woven from decades of gender inequality.

The persistent gender pay gap, with women typically earning 82 cents for every dollar earned by men, sets women back from the start². Lower earnings translate to smaller retirement savings, leaving them with less to live on in their golden years. But the pay gap is just the tip of the iceberg.

Career interruptions for childcare and eldercare further disrupt earning potential, pushing women towards part-time work or career pauses that erode their retirement savings. 

So what can you do as an employer?

Financial Wellness Beyond Retirement Planning

Traditional retirement planning programs often fall short for women juggling diverse financial responsibilities. Effective programs must encompass a holistic approach to financial wellness, addressing needs beyond retirement savings. This includes:

• Budgeting and debt management: Practical tools and guidance to manage day-to-day finances and reduce stress.
• Caregiving expenses: Resources and support navigating costs associated with child care, elder care, and other caregiving responsibilities.
• Healthcare costs: Information and support in understanding and managing healthcare expenses, particularly those specific to women's needs.
• Personalized financial education: Tailored learning modules and coaching on topics relevant to women's financial realities, from investing to insurance.

Investing in such holistic programs not only fosters greater financial well-being for women but also strengthens families and communities, leading to a more resilient and prosperous society for all.

The Business Case for Comprehensive Programs

Investing in the financial well-being of female employees through comprehensive programs can yield significant benefits for employers:

• Increased productivity and reduced absenteeism: Financially stressed employees are less focused and prone to absenteeism. Empowering women to manage their finances leads to higher engagement and attendance.
• Enhanced talent retention: Women represent a vital part of the workforce. Demonstrating commitment to their financial well-being attracts and retains top talent, reducing recruitment and training costs.
• Improved decision-making: Financial literacy leads to informed financial choices, contributing to better debt management, responsible saving habits, and reduced dependence on employer benefits.
• Boosted employee morale and satisfaction: Feeling empowered and supported in managing finances increases employee morale and overall satisfaction, fostering a positive work environment.

These positive impacts extend beyond individual employees, strengthening company culture and brand reputation. When employers champion financial wellness for women, they become known as progressive and supportive workplaces, attracting diverse talent and fostering a sense of social responsibility.

Collaboration Is Key

Bridging the retirement gap for women demands a collective effort. Employers, financial wellness providers, and employees must join forces to create comprehensive programs addressing the diverse needs of women. A great structure should be: 

• Employers: Set the strategic direction, provide resources, and track progress. They conduct needs assessments, choose providers, integrate the program with existing benefits, and monitor its impact.
• Financial Wellness Providers: Design tailored curriculum, offer engaging learning modules, provide personalized coaching, and continuously update content based on data and feedback.
• Employee Assistance Programs (EAPs): Offer confidential support for personal matters impacting financial well-being and can refer employees to the program or integrate financial topics into their services.
• Financial Coaches: Conduct financial assessments, develop personalized action plans, offer ongoing coaching, and provide emotional support and motivation.
• Employees: Actively participate by taking advantage of resources, sharing feedback, and putting learning into practice.

Collaboration thrives on clear communication, shared data, and flexibility. Joint needs assessments, open communication channels, data-driven insights, and adaptability ensure the program stays relevant and effective.

Final Thoughts

While bridging the retirement gap for women offers demonstrable ROI for businesses, its impact extends far beyond profit margins. Empowering women with financial knowledge and confidence creates a ripple effect, strengthening families, communities, and the entire economy. A financially secure woman contributes more as a consumer, invests in her children's education, and fuels economic growth. 

Enrich recognizes the power of this collective triumph. We work alongside employers to integrate Enrich seamlessly with existing employee benefits and support systems, ensuring long-term engagement and sustained results. The success stories speak for themselves: companies partnering with Enrich witness increased female employee retention, higher participation in retirement plans, and a demonstrably more vibrant and empowered workforce.

Investing in women's financial security transcends the corporate landscape. As women improve their financial wellness, they contribute to stronger families, healthier communities, and a more stable society. By choosing to bridge the retirement gap for women, businesses don't just invest in their employees; they invest in a thriving future for everyone.

1 - National Institute on Retirement Security

2 - Pew Research Center