Women & Retirement Planning: Is it an Advantage to be Married?

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Women & Retirement Planning: Is it an Advantage to be Married?

Financial security in retirement depends on economic success during your working years–that seems intuitive. But did you know that married couples may have a better chance at a comfortable retirement than people who are single, widowed or divorced? This is especially true for women.

Married women are more likely to feel positive about their retirement savings than their single counterparts… or so the data shows. Married women do tend to have higher incomes and accumulate more wealth, but that isn’t translating into more security in retirement, according to a study by the Center for Retirement Research at Boston College, or CRR. Furthermore, a study by the Employee Benefit Research Institute, married women are more confident they will have enough money to live comfortably in retirement than divorced or never-married women.

In this Retirement Survey, 76% of married female workers were very or somewhat confident they would have enough money to live comfortably throughout their retirement years compared with just 43% of divorced female workers and 51% of never-married female workers. 

So why are women better off married than never married or divorced?

Married women are generally better off than single women–they have higher earnings, more financial assets, and home equity, and they are more likely to be covered by a defined-benefit pension. Their households often benefit from having two incomes, too. On the flipside, The Employee Benefit Research Institute’s 2022 Retirement Confidence Survey found unmarried women workers and retirees have lower retirement confidence than their married counterparts and are more likely to have lower incomes and assets. Further data reveals significant differences in these three key areas:

  • Retirement Savings: Although Americans in general are terrible at saving for retirement , single women tend to be farther behind the curve than married women. (EBRI Study)
  • Economic Status: Married women’s households have higher earnings and more home equity, greater assets in a defined-contribution plan, and are more likely to be covered by a defined-benefit plan. (NRRI Study)
  • Health & Financial Risks: Single women are also at greater risk of losing all of their assets because of job loss or health complications, and more likely to develop a serious medical condition, suffer a disability or enter a nursing home than married couples. (CRR Study)

Whether you are married or not, there are ways to increase your chances of a financially secure and successful retirement.

One of the biggest advantages of marriage is eligibility for spousal and survivor Social Security benefits. As a married couple, you’re each eligible to collect your own Social Security benefit or up to 50 percent of your spouse’s benefit, whichever is greater. That’s a particularly valuable benefit for women who left the workforce to care for children or aging parents and have limited benefits of their own. They’ll lose that benefit, though, if they remarry.

Widows or widowers who remarry before age 60 lose survivor benefits based on their deceased spouse’s earnings. Unless the divorce decree says other­wise, remarriage will end alimony payments from a former spouse.

Delaying Social Security as an important strategy here. This is the best way to boost retirement income, even for higher-earning married couples that face the relative disadvantage of Social Security’s progressive benefit formula.

Clearly, there are issues here that must be overcome. The approaches currently being used simply doesn’t appear to be as effective for unmarried women, likely due to the resulting financial and life-circumstance upheaval of a divorce or death of a spouse. However, just like your single male counterparts, women in every marital status can help themselves now for a comfortable retirement.

A supplemental survey conducted by EBRI showed that women in differing situations could benefit from receiving more specialized information and assistance with retirement preparation and everyday financial issues.

By gaining a personalized financial strategy from an experienced retirement income advisor, women in all circumstances can attain invaluable advice for a better sense of security when planning for retirement; You want to know if you’ve saved enough, if your money will last and if you have all your bases covered.

Marriage can certainly be beneficial in retirement planning; but that doesn’t mean that if you’re single, you should rush to get hitched to secure security in your old age. With careful planning and diligence, single, widowed and divorced women can fare just as well.

If you’re a woman who’s been avoiding financial planning, it’s never too late to get involved. The Retirement Income advisors at CKS Summit Group specialize in helping women achieve fresh new ideas for retirement income; and we are most interested in what YOU want out of life.

Make this the year you take control of your own financial future. Contact us here today so we can plan for a comfortable and confident retirement while also making the most of your current lifestyle and each step you take along life’s journey.