Whether you’re in your first paid job or a year away from that corner office, you need to start thinking about saving for your retirement. Millenials already have the dubious honour of being the first generation to earn less than their parents, and this new study reiterates that women haver it worse off than men.
According to an American study of over 4,000 workers, only 56 per cent of women are actively involved in managing their savings, as opposed to 70 per cent of men. Since women also earn traditionally less than men for doing the same job, they have less money to divert towards a post-retirement fund. The same study found that most women cited “covering basic living expenses” as their top financial priority, as compared to their male counterparts who always have an eye on saving for the future.
The younger you are, the easier it is to start the habit of saving up, especially if financial responsibilities like loan repayments, mortgages and children’s education haven’t yet kicked in.
How to start saving for retirement
In an interview, Catherine Collinson, president of Transamerica Center for Retirement Studies, offered these basic tips for women looking to kickstart their savings plan.
- If your workplace offers a retirement plan to its employees, make sure you enrol in it.
- Set up an automatic deduction via your company or your bank for as large a sum as you can afford to get by without.
- Hire a financial planner and ensure you actively participate in managing your funds. Collinson says, “If your employer offers financial workshops or other types of retirement saving educational advice, sign up for them. In the 20-plus years I’ve been doing this, I’ve observed continuing innovation in educational services and planning tools. Yet only a small percentage of people take advantage of them.”