Women Have 30% Less in Retirement Income Than Men. Here’s How To Change That.

Having children and leaving the workforce–for the short or long term–to prioritize family is a significant driver behind the fact that, on average, women have 30% less retirement income than men.

Moms should never have to choose between their family and their finances. This compounds the already abundant pressures we know moms face daily as they juggle their many priorities.

“As mothers, we often make choices and sacrifices for the benefit and well-being of our families, but taking time to care for our loved ones doesn’t have to end the investment we make into ourselves and our future – especially when it comes to our retirement,”  says Melody Evans, Wealth Management Advisor, TIAA.

Saving Today, for Tomorrow:

As women make decisions that are best for themselves and their families – planning for retirement should remain among the top considerations on their list, says Melody. Taking a break from saving today can greatly impact their retirement savings balances tomorrow.

Saving for retirement is one of the most important financial decisions individuals can make, but for some moms, saving for retirement often takes a back seat to other life responsibilities, such as taking time from the workplace to care for their children, and that break could be contributing to the gap in retirement savings totals between men and women.

Saving for retirement is important for everyone – but the need for women to save early and adequately for retirement is even greater. This is because women typically retire earlier with 30% less in retirement savings than men (Source: Organization for Economic Cooperation and Development, March 2021). Not only that but research shows that women also have a longer life expectancy and may need to rely on their retirement savings even longer.

Moms and Retirement Survey

TIAA has teamed up with economist and author, Emily Oster to take a closer look at the challenges mothers face regarding retirement planning.

In a survey of approximately 1500 women across all education levels, three common themes emerged among respondents that could offer a glimpse into the disparities we are seeing in retirement savings accumulations.

  1. Lack of Awareness of retirement savings as a key financial decision point post children
  2. Lack of Action in retirement savings
  3. Lack of Resources/Support

Key Findings:

Lack Of Awareness and Retirement Savings Decisions:

  • 36% of women surveyed reported putting a lot of thought into the impact of staying at home on their retirement savings, versus 50% who put a lot of thought into the cost of childcare.
  • 54% of women surveyed reported that they would keep their current job instead of starting a new job with a higher salary but higher childcare costs.
  • 32.6% of respondents reported that they never learned about retirement savings from any sources — including parents, a first job, or in school.

Lack of Action

  • 47% of women reported no retirement savings at all
  • 27% are saving, but not to the level that they want
  • Savings Totals are lower for women with less education.

Lack of Support

  • 48.2% of employed women say their benefits include employer retirement fund matching.

Melody Evan’s Anecdote

As mothers, we all make choices and sacrifices to benefit the health and well-being of our families, and I am no exception. Since the start of my career, I have had two maternity leaves of absence and one year of part-time work. Leading up to my leaves, I tried to be as proactive as possible, understanding if my short-term disability at the start of my leave meant I would miss out on 401k contributions and planned to catch up after I returned. Every year my husband and I review our retirement benefits, contributions, and matching contributions and those years of parental leave were no different.

Upon returning to work full-time I realized how the skills I hone daily as a mom (time management, preparation, efficiency, patience, attention to detail, follow through), made me a greater asset in the workplace. I was unapologetic about communicating that skill set in my own performance reviews.

Invest in Yourself

Melody Evans recommends the following action items for all women, especially mothers, as they prepare for a secure financial future and retirement.

Prioritize Yourself: Add saving for retirement to your list of priorities.

Don’t wait to Save: Saving early and consistently is key to building retirement savings you can live on. If someone who is currently 30 years old puts just $20 a month into a retirement savings account at 7% interest, they would have approximately $34,000 in savings by age 65.

Make Saving Easy: Set up Automatic Contributions.

Every Dollar Counts: Contribute up to your employer match. No employer-match? Contribute anyway. Small dollars add up over time. Try increasing your retirement plan contributions by 1% of your pay each year. If it feels too tight for your budget, you can always make a change, but you will likely adjust more seamlessly than you thought.

Plan to stay on track: Planning to take a break from the workforce? Open a retirement account and make regular contributions while on leave.

Know Your Worth and Ask for It: Every woman should feel comfortable asking for more money at work. If they don’t feel comfortable, they should ask anyway. Don’t let a break in work or a reduction to part-time in the past deter you from getting paid the right amount for your output today. If your work creates meaningful results for your employer, ask to be paid accordingly.

More than just a number: Consider the big picture when planning your future. How will a new position fit into my long-range goals?

More than half of women (54%) reported they would keep their current job rather than take a new job with a higher salary but with higher childcare costs.

Consider a woman who makes $60,000 annually and saves 3% of her salary ($1,800). She’s offered a new job that pays $65,000, but she has to spend all of her additional take-home pay on childcare for the next three years.

In the long run, though, this decision can have big impacts. In those first years, at her 3% savings rate, she’ll increase her retirement savings by $4,800, which can have drastic positive effects later in life.

Master Your Benefits: Become a benefits wizard. Lots of people leave money on the table each year by simply not knowing what unique benefits their employer provides.

Get support: A financial advisor can help create a plan to support your financial goals.


Hi! I am a millennial mom with a passion for personal finance. I have always been “into” personal finance but got inspired to start my blog after a period of extended unemployment. That experience really changed the way I viewed my relationship with money and the importance of accessible personal finance education.