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The 4 reasons women fall short on retirement savings and what they can do to catch up

By: Equities.com

July 15, 2025 at 12:03 PM EDT

The 4 reasons women fall short on retirement savings and what they can do to catch up

Women are at a major disadvantage when it comes to saving for retirement because of four main societal influences and overcoming those hurdles requires more than a cookie-cutter approach to financial planning, two personal finance experts say.

Jean Chatzky, a Briarcliff, N.Y.-based personal finance columnist and editor and host of the Her Money podcast, outlined the four challenges at the Morningstar annual investment conference held recently in Chicago:

Women earn less over the course of their careers than men, on average
Women take more caregiving breaks from the workforce than men
While they have a lower pool of money to start with, women must make that money last longer than men have to given longevity statistics
Women tend to be less aggressive investors, holding down their long-term returns in their retirement portfolios

“There is this belief that we as women have to step out of the workforce, for our children but especially for our older parents. But so much is lost when we do — our net worth, our career track, maybe our Social Security and our pension,” Chatzky said.

Carolyn McClanahan, a physician and financial planner who heads Life Planning Partners based in Jacksonville, Fla., echoed those sentiments at the conference where she and Chatzky shared a keynote presentation.

“Women often do such a great job of taking are of everyone else that they don’t take care of themselves, financially and health-wise,” McClanahan said. “Many raise kids and then take care of older parents, and that caregiving is a hard job.”

The biggest offset to those retirement drawbacks is one that women won’t actually have much control of: the coming generational wealth transfer of more than $100 trillion in assets, about 70% of which is expected to end up in women’s hands.

“This intergenerational wealth transfer is going to help, as women inherit from both their parents and their spouses,” Chatzky said. “But it is a very slow-moving train.”

Here are xx actions Chatzky and McClanahan recommend women take to shore up their retirement prospects:

1. Invest in yourself

“Your greatest asset is your human capital. You both have to be thinking about it,” McClanahan said.

Women are often the ones who squander that capital when they leave the workforce to raise children. McClanahan recommends couples create an emergency fund, make sure both partners are saving for retirement and also save in advance for the time when children come along so that both can take time off when needed.

McClanahan also recommends couples create financial transparency in their relationships from the beginning and that each spouse maintain a reserve of their own.

“Everybody needs their own money. No one wants to ask their husband when they want to have ice cream,” she said.

2. Start saving now

Chatzky said she hears a lot of questions from women in their 40s and 50s who feel as though they did not start soon enough in saving for retirement. But McClanahan counsels that it is never too late.

“It’s just like with your health — everything you do each day adds up,” she said. “Look at what you are spending on, work on your career — there are so many reasons to work longer now, but make sure it is at a job you love.”

3. Take care of your health

McClanahan started her career as a doctor but became disillusioned with the medical profession over what she saw as racist and misogynist health-care practices. She pointed out that is was only recently that women finally made up half of the physicians in the U.S.

“The inequalities are being corrected, but slowly,” she said.

But she said the transition to being a financial planner was not as surprising as you might think.

“Health touches all aspects of financial planning, whether you are talking about longevity planning, chronic illness risk or long-term care needs,” she said. “Where will you live as you age? Will you need help with health-care decisions? When will you need to turn over financial control to someone else? When will you quit driving? Those are all questions that need to be addressed.”

4. Consider financial planning

Statistics show that 80% of women who get divorced seek a new financial advisor when they move out on their own and that could portend the same kind of shift as all that generational wealth changes hands over the next 25 years or so. But women who are still part of a couple today can begin to lay the groundwork for a better financial advisor relationship, McClanahan said.

“Make sure that both of the couple are included in any discussions, that both clients are in on all emails. You need to at least know that basics of what is going on with your finances,” she said. “Planners should be directing questions to both member of the party. To get a good outcome they should make sure they are getting a good history first.”

Working with a financial planner can also help women overcome some of the reluctance they have to investing more aggressively in order to close the retirement funding gap.

“Women are more likely to want their mortgage paid off in retirement, whether that makes financial sense or not. But women are more open to taking risks when they are educated about those risks,” she said.

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The 4 reasons women fall short on retirement savings and what they can do to catch up

1. Invest in yourself

2. Start saving now

3. Take care of your health

4. Consider financial planning

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