Are Men Or Women More Successful At Saving For Retirement?

By Zina Kumok

July 26, 2016   •   Fact checked by Dumb Little Man

saving for retirement

Do you know who is more successful at saving for retirement?

The sphere of finance and economics is largely male-dominated. From the most powerful positions to the highest salaries, the world of wealth has been a boys’ club since the first drachma was minted in ancient Greece.

While that disparity isn’t disappearing anytime soon, advocates for gender equality can look to one area of finance as a sign of the changing tide: retirement-saving.

According to a recent study by investment management behemoth Vanguard, women are out-saving men for retirement, and it’s not even a close race. Read on to learn more.

The Study

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A 2016 survey from financial firm Vanguard found that despite the wage and wealth gap, women are outsaving men for retirement. In fact, women are almost 15 percent more likely to save, and when they do, they save 7-16 percent more than men.

Even women who are earning less than $50,000 are still saving for retirement at a rate of 45 percent compared to 28 percent in men. These women prove that a low salary doesn’t have to dissuade you from saving for retirement.

The study also observed that women are more likely using pre-packaged options like target-date funds, which choose a basket of funds based on when you hope to retire. Target-date funds are a good choice for someone who wants to invest in the market but doesn’t know which securities to choose.

Unfortunately, the study also revealed that both sexes are not saving enough for retirement. Women set aside 7 percent of their salary for retirement—nowhere close to what they need. Most experts recommend saving between 10-15 percent of their salary for a comfortable nest egg in retirement years.

The women involved in the survey earned $68,895 on average, while the men earned $85,983, making their savings rates all the more impressive. The study also dispelled the myth that women are less likely to invest in the stock market, stating in the abstract that “on average men and women take very similar risk levels and hold similar types of portfolios.”

How Men Can Catch Up

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While gender experts may be able to extrapolate some deeper reasons behind this gap, there’s nothing inherently gendered about the actions women are taking to save more. Any man is capable of bridging that divide with thoughtful and consistent financial decision-making.

Here are a few important steps to take.

Take advantage of employer-sponsored plans.

The easiest way to get started saving for retirement is to sign up for a plan through your employer. Nowadays many companies offer 401ks and other options for their workers, often with a company match.

Not only could you be eligible for free money, but you’ll have access to someone designed to walk you through the intricacies of starting and funding your retirement.

Start early.

Men earning less than $50,000 should start saving for retirement now even if their instincts are to wait until they’re earning more. Time and compound interest can take small, regular contributions and turn them into large sums later on.

Even if you can only save $25 a paycheck, it’s better than nothing.

Take advantage of catch-up contributions.

If you’re an older man who’s been slacking on retirement saving, it’s not too late. Those 50 and older can take advantage of catch-up provisions for IRAs and 401ks, which allow you to set aside more money.

You can put an extra $1,000 toward your IRA and an extra $5,000 to your 401k per year.

Take advantage of higher salaries.

Not only are men likely to earn more than women, but they’re also more likely to have jobs making more than $100,000 a year. They should use those high salaries and put more money into their employer-sponsored retirement plans (or IRAs if those aren’t an option).

Ask for help.

If you’re having trouble starting to save for retirement and aren’t sure what to do, consulting a financial planner may be the best option. An advisor can tell you how much you need to save and what kinds of investments to choose. They can make custom recommendations based on your goals and where you are in life.

And if all else fails, you can turn to the real experts: the women in your life.

Zina Kumok

Zina Kumok is a 20-something writer for and specializing in personal finance.

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