While the coronavirus pandemic has impacted the finances of people across the board, women may be particularly at risk as it relates to long-term financial stability.
A majority of women (70%) are saving for retirement during the pandemic. Yet, nearly a quarter of women (24%) who are either working or had been working until recently said they’re less confident in their ability to have a comfortable retirement in light of the pandemic, according to new research by the Los Angeles-based think tank Transamerica Center for Retirement Studies. In comparison, 20% of men felt that way.
With the pandemic’s future impacts unknown, the financial anxiety that women are facing may not change anytime soon.
Women more wary of the future than men
Only 17% of women described themselves as "very confident" that they would be able to retire comfortably in the future, compared with 30% of men who were "very confident." And 12% of women said they were "not at all confident" of their ability to retire comfortably — higher than the 7% of men who felt this way.
One explanation for women’s wariness could be that women and men are not on a level playing field when it comes to finances. It’s no secret that women, in general, make less money than men. In fact, a 2019 study suggests that progress has stalled on closing the gender wage gap.
With less income to work with in general, many women have seen their resources stretched even further during the pandemic. More than half of women workers (52%) have had their job impacted in some way because of the coronavirus crisis. Among that subset:
- 24% had their work hours reduced
- 16% experienced layoffs
- 13% had their salary reduced
- 13% experienced furloughs
Women juggling financial priorities
Employment struggles can make it even more challenging for women to follow through on their financial priorities. Among women respondents, 33% cited covering basic living expenses as a financial priority, while:
- 59% cited paying off debt
- 50% cited saving for retirement
- 44% cited building an emergency fund
When asked their top financial priority during the pandemic, 16% of women said "just getting by to cover basic living expenses" — a higher percentage than the 9% of men that felt that way. Women were also more likely than men to cite supporting children as their top financial priority right now, 12% versus 7%.
If women encounter financial struggles during the pandemic:
- 51% said they would rely on their savings
- 29% said they would depend on unemployment benefits
- 29% said they would look to benefits under the Coronavirus Aid, Relief and Economic Security (CARES) Act
- 25% said they would turn to credit cards
Also, 18% of women said they have either taken out a loan or withdrawal from a retirement plan or they intend to do so, compared with 37% of men. However, 17% of women said they have no savings in a qualified retirement account to turn to — less than the 10% of men who have no retirement savings.
Methodology: The Transamerica Center for Retirement Studies commissioned opinion and research firm The Harris Poll to survey 2,001 adults between June 18 and 22, 2020. Data reported above comes from a subset of 1,260 adults who worked full time or part time when the survey was conducted or who had done so before being laid off or furloughed because of the pandemic.