By Daniel Korleski, MBA
As a woman, you may face financial challenges that differ from those experienced by men: longer life expectancy, career breaks for caregiving or other priorities, and the persistent gender pay gap are just a few factors that can impact your retirement planning.
If you’re approaching or past 40, now is a crucial time to take a close look at your retirement strategy. By addressing these unique challenges head-on, you can create a plan that offers both stability and confidence for your financial future. Let’s explore some of the key obstacles women often encounter and outline practical steps to help you build a retirement plan that truly supports your goals.
Retirement for Women: Financial Planning Obstacles
Women encounter several issues in retirement planning that may be necessary to consider when preparing for the future.
Longer Life Expectancy
The National Center for Health Statistics shows a big difference between the life expectancies of American women and men. Data from a 2022 study reports that the life expectancy of women in the U.S. averages 80.2 years—a full 5.4 years more than the average life expectancy for men. This indicates that women likely have more retirement time to plan for.
Income Gap
Despite increased efforts to attain equality, women still face a substantial pay gap compared to their male counterparts. As of 2022, American women earned an average of 82% of what men made, limiting their ability to save for retirement. Some women may earn less due to pausing their careers to start families.
Healthcare Expenses
With their longer life expectancy, women may encounter higher medical expenses in retirement than men. These costs may escalate when women need long-term care or treatments for conditions older individuals commonly face.
Lower Social Security Benefits
Because many women have shorter times in the workforce than men, they may receive lower Social Security benefits. As this disparity affects retirement income for women, financial planning is especially important.
Setting Retirement Goals
For both men and women, financial planning is more productive when it reflects a set of attainable goals. Some of the clearest, most reasonable goals include:
- Setting a target date for retirement
- Planning your desired retirement lifestyle
- Evaluating current savings and income
- Assessing future needs with retirement calculators
Circumstances can always change. It’s always worth leaving substantial room for adjustments in your retirement plan. Here are some areas that may need more focused attention.
Maximizing Retirement Contributions
Whenever possible, making the maximum annual contributions to a 401(k) account, traditional IRAs, or Roth accounts can help women grow wealth more quickly. Married women may also rely on spousal IRAs if they experience career gaps.
Investing to Grow Wealth
An investment account can produce significant gains in wealth for the future. It’s always good to maintain a diverse portfolio of several different types of holdings in various sectors and market caps. Tailor your investment strategy based on your risk tolerance, age, and time frame.
Planning for Healthcare
Medicare and long-term care planning are essential to consider before issues arise. Find out about Medicare eligibility requirements, coverage options, and extended care needs in retirement. Starting a tax-advantaged health savings account (HSA) and an emergency savings fund can be beneficial—talk to a financial coach about all your options.
Social Security and Pension Planning
Many women rely on benefits from Social Security or pensions in retirement. You may consider delaying the receipt of Social Security benefits until later in life since that might result in larger monthly payouts. Think about setting up spousal and survivor benefits, if applicable, in case of your passing early.
Tailored Retirement Strategies for Women
Retirement planning is especially important for women over 40 and deserves your focused attention. At Cobalt Private Wealth, we develop tailored strategies designed to promote strong financial well-being and confidence for your future. When you connect with us, you’ll work with a trusted advisor who prioritizes your unique circumstances, challenges, and long-term objectives throughout the entire process.
If you have questions or would like more info, reach out to me at danielkorleski@cobaltprivatewealth.com or 719-332-3863 to schedule a meeting. I’d love to connect and learn more about how I can help you pursue your ideal future.
About Dan
Daniel Korleski is the President & CEO for Cobalt Private Wealth, where he helps his clients grow, manage, and protect their wealth so they can work toward a stronger financial future. With over 30 years of experience in the financial services industry, Dan has served as the managing director for Investment Trust Company, chief investment officer for the Wealth Management Group at American National Bank in Denver, and regional investment manager for the Greater Colorado Region of the Private Bank at Wells Fargo, where he oversaw the management of over $2 billion. In 2008, he was appointed by the mayor of Colorado Springs to the City’s Investment Advisory Committee. Dan holds an MBA in investment management from Midwestern State University in Wichita Falls, Texas, a Bachelor of Science in Finance from Florida State University, and is a member of both the CFA Society Colorado and The Financial Planning Association.
Dan loves to give of his time to his community and is currently serving as the Board Chair of Catholic Charities of Central Colorado and oversees the Homebound Ministry at St. Paul Catholic Church. He has also served as Chair of the Board of Trustees of Pikes Peak Hospice Foundation, President of the Broadmoor Rotary Club, and Vice President of the Board for the Pikes Peak Chapter of Trout Unlimited. Dan was born and raised in Spain and is fluent in Spanish. To learn more about Dan, connect with him on LinkedIn.
