Personal Finance

Gender Gap: Men And Women Plan Differently For Retirement

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You can add yet another way that men and women differ from each other. Check out how they disagree when it comes to retirement planning.

Men tend to start planning earlier, and are happy with their plans. More women worry about how to avoid running out of money.

That's a takeaway from a new survey of retirement planning attitudes and experiences by TIAA, a financial services provider. According to TIAA's new Voices of Experience 2016 report, male and female retirees often think about retirement differently -- and there are key differences in how they prepare for it.

Among the key differences concerning financial aspects of retirement:

  • Men tend to start planning for retirement earlier. Overall, 22% of men said they began planning before the age of 30. Only 12% of women started that early.
  • 42% of men surveyed said they are satisfied with their retirement preparations vs. 33% of women.
  • 15% of men said their biggest retirement concern is running out of money vs. 29% of women.
  • 58% of men are very satisfied with their financial health vs. 46% of women.

From the survey, men come across as more confident about retirement readiness and more satisfied with their planning.

That, says financial advisor Brett King, reflects men's self-deception.

"They are kidding themselves," King told IBD. "In many cases, they are happier because they are deceiving themselves. Women are more worried because they've done a better job of asking more of the right questions. They're concerned about whether they and their spouses really are as well-prepared for retirement as the men think they are. The men haven't dug deep enough."

King was not involved with the TIAA survey. He was describing men and women who come to him for advice. He is senior vice president, investments, and managing partner of Elite Financial Associates, based in Tampa, Fla.

The problem that many men have with retirement planning, King says, is that they often focus on goals. More women tend to focus on how to reach their goals.

"Men are big picture oriented," he said. "Women are more detail oriented. If I prepare a plan for a husband and wife, it is women who want to go through the details. All the men care about is the bottom line. They're less patient. They won't want to deal with the umpteen options for when to start Social Security benefits , for example, or whether one spouse should start now while the other delays the start."

Women's focus on details may stem from the fear that more of them have about outliving their money in retirement. "Longevity has something to do with it," King said. "Women tend to live longer."

Even the trend of more men starting retirement planning earlier in life may reflect self-delusion. "Men think putting a little money into a 401(k) account at work is the same as planning," King said. "It isn't."

Planning involves identifying goals, then figuring out how to reach them , according to King. This requires making a budget and figuring out if the amount of money you're saving for retirement will generate enough income to pay for the standard of living you're aiming for. It requires calculating how large your nest egg will be at retirement. It requires making hard decisions about how to close any income gap that crops up in your planning process.

TIAA manages money and provides retirement services, specializing in clients in the academic, research, medical, cultural and government fields.

Other survey findings:

  • 50% of men said that ensuring the financial security of a spouse or partner is a top priority vs. only 14% of women.
  • 16% of men wish they had prepared differently by learning more about their Social Security options vs. 21% of women.
  • 18% of men wish they had learned more about non-Social Security sources of income vs. 29% of women.
  • 26% of men wish they had learned more about managing savings and investing vs. 32% of women.
  • 14% of men regretted not learning more about how to maximize employer retirement and benefit options vs. 26% of women.
  • 77% of men find the transition to retirement easy vs. only 69% of women.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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