For Vadaire James, a wellness counselor from Winston-Salem, N.C., being single is fine — especially right now while she is helping care for her octogenarian parents.
What nags at her, though, is what her life will look like when she’s their age.
“I moved here six years ago from Washington, D.C., to help support my parents, and since then, my retirement saving priorities have taken a bit of a back burner,” the 51-year-old told Yahoo Finance. “I feel like I’m way behind the eight ball right now, and I don’t feel comfortable at all about what my future might look like.”
In 2022, there were 43.5 million single adult women in the US, up from 37 million a decade earlier, according to the most recent figures from the US Census Bureau. That’s the highest level ever — and for many of them, like James, the risk of running out of money in retirement is a serious concern.
The triple threat for single women’s retirement security
Here’s why single women are uniquely vulnerable: It’s the combination of potentially longer life spans and the persistent pay gap when compared to their male peers, along with fewer years in the workforce due to timeout for caregiving — all without the fallback of a partner’s income to rely on.
“Single women don’t have anybody else to lean on but themselves when it comes to their money,” said Cindy Hounsell, president of the advocacy group Women’s Institute for a Secure Retirement (WISER).
Now, several new research reports are shedding light on the precarious state of their financial security and retirement savings.
Let’s start with the pay gap — women in the US earn $0.84 for every $1 earned by men, according to the National Women’s Law Center.
That, in turn, translates to less money available to set aside in retirement funds. Many women also tend to take time out of the workforce for caregiving of children and family members, which often means a pause in contributions to retirement accounts. That, combined with the pay issue, results in lower future Social Security checks.
According to the Social Security Administration, the average monthly retirement benefit for retired men age 65 and older was $2,020 in 2022, and for retired women of the same age, it was $1,638.
In addition, about a quarter of women workers are not offered any retirement benefits by their employers, compared with only 16% of men, according to a 2023 Transamerica Institute report. That discrepancy is due in part to the fact that women are twice as likely as men to work in part-time contract jobs and many employers don’t offer retirement benefits to their part-time employees.
The challenge is even greater considering that women tend to live longer than men — nearly six years longer, according to the Centers for Disease Control and Prevention. That means women must get by for longer on far less.
See related story: Retirement planning: A step-by-step guide
‘Significantly less wealth’
Among women and men who have never been married, the wealth gap is notable, according to a recent analysis from the Federal Reserve Bank of St. Louis. The research focused on the segment (23%) of adults who have never been married, which strips out any outside sources of wealth that could come from being divorced or widowed.
In 2022, never-married women had $19,200 in inflation-adjusted median household wealth, and men in that group had $28,100. These women had $0.68 for every dollar of wealth owned by the men — much wider than the broader gender income gap, which stood at $0.90.
The data reveals racial disparities among women as well. Never-married white women had a median $31,000 in wealth, almost 10 times the amount owned by their Black counterparts. Median wealth for never-married white men stood at $40,000.
Student loans and single women
An early start to retirement savings makes a big difference, but for many women in their 20s, debt can be a stumbling block to getting started.
Women hold an average of $31,276 in student debt, leaving them with a monthly loan payment of $307 the year after graduation.
In fact, women take about two years longer than men to repay student loans, according to an American Association of University Women’s analysis. The reason: smaller salaries than their male counterparts. From the moment women graduate from college, most face a gender pay gap — which widens as they age.
The upshot is that some women may put off saving for retirement, and even delaying by a few years can make a difference decades down the road when you consider the power of compounding interest and reinvested dividends.
Hounsell added that many single women figure they will just work longer if they are behind on savings. “But you might not be able to work as long as you expect,” she said.
Read more: Tips for quickly paying off student loans
The impact of caregiving on savings
Caregiving is a key challenge. Overall, women are more than twice as likely as men to leave the workforce for more than one year to care for children or aging parents, according to new research, “Challenges Women Face Saving for Retirement,” from Goldman Sachs.
The data found that 40% of working women reported leaving their jobs for caregiving needs (childcare and eldercare), and 21% reported leaving a full-time job for part-time work to provide caregiving.
“Single women may have to step away from a job if they’re going to help their parents,” Kimberlee Davis, author of “The Fiscal Feminist: A Financial Wake-Up Call for Women,” told Yahoo Finance. “And that could be really detrimental to them because they’re the only game in town for saving for their retirement.”
Women are “programmed to be caregivers, and they also are programmed to put others ahead of themselves at their own financial risk,” she said. “And at some point, we need to learn that we have to be a little bit more selfish.”
Her tip: Women who have enough income should start a taxable brokerage account and make it an automated investment. “Whether it’s only $250 a month, a hundred dollars a month, it’s to get that habit going and get that feeling of seeing your account grow,” Davis said. “Because taxable accounts are as important as retirement accounts.”
Knowledgeable, but not confident
Only a quarter of single women have a retirement account vs. half of married women, according to New York Life Wealth Watch data. And two-thirds are not confident that their retirement savings will last the rest of their life. At the same time, 6 in 10 feel very knowledgeable or somewhat knowledgeable about saving for retirement.
James is in that knowledgeable crew — now. “I needed to make changes in my job so I could be with my parents, and it has been nice, even if they can be a handful,” she said.
Her decision meant a significant drop in salary, but she hasn’t stopped saving in her retirement account. “I add money every month, although I waver on how much I’m able to do,” she said. “If my income was greater, of course, I would put more aside.”
She admits she holds a lingering regret. “I remember when I was 21, and my mom sat me down and said, ‘If you put money in a retirement account now, this is how much it’ll be when you’re 30, 40, 50, 60.’ Of course, that went in one ear and out the other, and while I have saved over the years, it has been inconsistent. I look back on it now and wish I would’ve taken her advice.”
Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist, and the author of 14 books, including “In Control at 50+: How to Succeed in The New World of Work” and “Never Too Old To Get Rich.” Follow her on X @kerryhannon.
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