Women: Let’s Talk About Retirement

The 12th Annual Transamerican Retirement Surveygives some advice and some ideas that may help both women and men who are thinking of retirement, but the advice is more timely for women.

Here are some of the ideas generated by this year's survey for more go to the link in the previous paragraph:

Here are five conversation starters for women …

• The good news is that small steps, when taken together, can add up to great strides in retirement preparedness. Retirement will be unique for each woman, but the tools to help achieve retirement readiness are common to all. Now is the time for every woman to focus on achieving financially a secure retirement:

  1. Start saving for retirement and get into the habit of saving on a regular, consistent basis. Save as much as you can,

  knowing that both small and large amounts add up over time.

  2. If your employer offers a retirement plan, participate. Be sure that your contribution rate takes full advantage of

  employer matching contributions, if available. Take advantage of the IRS Saver’s Credit if eligible. Consider taking

  advantage of catch-up contributions if you are age 50 or older.

  3. Develop a retirement strategy and write it down. Envision your future retirement and use an online calculator to estimate your long-term savings needs. Then formulate a goal for how much you will need to save each year (be sure to include employer-sponsored retirement plans and outside savings) – and hold yourself accountable for saving.

  4. When facing life’s important decisions about whether to reduce work hours or take time out of the workforce to be a parent or caregiver, carefully consider the financial trade-offs and options – such as shifting to part-time work – to help mitigate the impact on long-term financial security.

  5. Maintain your ability to continue working past age 65. Keep your job skills up to date or learn new ones. Many employers, community colleges and nonprofits offer classes in the latest technologies and careers. Networking groups offer opportunities to meet more people in particular professions.

  6. Become personally involved in your family finances ranging from daily budgeting to long-term planning. Discuss retirement saving and planning with family and close friends. An open dialogue with family members about expectations of either needing to provide or receive financial support should be part of every woman’s retirement strategy.

  7. Get educated about retirement investing. Learn about possible ways to help make savings last longer including when to take withdrawals from retirement accounts to minimise taxes and penalties, and the best time to start Social Security to maximize benefits. Seek professional assistance if needed.

  8. Have a backup plan in the event of unforeseen circumstances such as separation, divorce, loss of a partner, or being unable to work before your planned retirement. Consider emergency savings; insurance products such as disability insurance and life insurance; and possibly ways to cut costs if needed, such as moving to a smaller home, taking on a roommate(s) or scaling back transportation costs. Keep job skills up-to-date.

• Pursue legislative and regulatory initiatives to expand retirement plan coverage for all workers including part-time workers:
• Additional safe harbours for 401(k) and similar plans for purposes of non-discrimination testing
• Expanding the tax credit for employers to start a plan and facilitating the opportunity of employers to participate in existing plans by implementing reforms to multiple employer plans.
• Expanding the Saver’s Credit by raising the income eligibility requirements so that more tax filers are eligible.
• Expanding Catch-Up Contributions by raising limits and lowering the eligible age.
• Extending the 401(k) loan repayment period for terminated plan participants and eliminating the six- month suspension period following hardship withdrawals.
• Requiring retirement plan statements to state participant account balances in terms of lifetime income as well as a lump sum