October 1, 2021

Boost Your Long-Term

Financial Fitness

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Following are five tips to help women plan for a financially secure future.

When it comes to building a financially secure future, women generally have different needs compared to men and some unique considerations to keep in mind when saving for retirement. While it may seem daunting to balance the responsibilities of day-to-day life with planning for your future, it’s important to focus on ways to ensure that you’re meeting your long-term retirement goals. Here are five tips on how to strengthen your financial fitness and increase your retirement savings:

  1. Strengthen your financial literacy. Take time to boost your financial literacy and ensure that you have a basic understanding of the savings and investment options available to you, as well as the considerations you need to weigh when saving for retirement, such as asset allocation and risk tolerance. With a better grasp on your investment and retirement savings options, you will be able to make more informed decisions that can help improve your financial security. Easy-to-use and reliable resources like the glossary in Mutual of America’s Retirement Center or federalreserveeducation.org are good places to start to become more financially savvy.
  2. Envision your ideal retirement. When thinking about your financial future, consider what you want your retirement to look like. Where do you want to live? How do you want to spend your time? At what age do you plan to retire? A good rule of thumb to remember is that many experts agree you’ll need approximately 80 percent of your gross annual preretirement income to maintain your standard of living during retirement.1 Note, however, that this is just a guideline. It’s important to consider not just when you want to retire, but also how long you’ll need to make that nest egg last so you don’t end up outliving your retirement savings.
  3. Manage your expenses. Make a budget to help you balance your daily expenses and make consistent contributions toward retirement saving. Use one of Mutual of America’s Retirement Calculators to help you break down how you divide your monthly income among your expenses.
  4. Boost your retirement savings. With women on average still earning less than men throughout the course of their careers,2 it’s even more critical to start saving for retirement as early as possible. To help boost your retirement savings, you should ensure that you are taking advantage of your employer match, if offered. In addition, you may want to consider increasing your contributions annually, even if by one percent, as it can have a meaningful difference in the long term. If you’ve reached age 50, you may also want to look into how you can take advantage of catch-up contributions.
  5. Look to other sources of income. Though the gender wage gap is closing,3 you may discover that there is a gap between what you’re able to contribute toward your retirement savings and what you’ll need to meet your financial goals. Remember to factor in the amount of Social Security you expect to receive—a key income source many individuals forget to include when engaging in retirement planning. While you can access part of your Social Security as early as 62, you should weigh the benefits of delaying your payments. To see your current Social Security statement and what you can expect to receive in your retirement, go to ssa.gov/onlineservices.

If you still feel like you’re falling short of your retirement goals, you may also want to think about potential ways to add an additional income source that you can put toward your retirement, such as a freelance job or a part-time opportunity, or turning a passion or hobby into a business.

While there are other factors to consider when making financial decisions, these can help you better prepare to build a more financially secure future. If you have additional questions about saving for retirement or would like to learn more, contact your local Mutual of America representative.

Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regard to your individual circumstances. All examples are hypothetical and are for illustrative purposes only. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.

1U.S. Department of Labor, Employee Benefits Security Administration, Savings Fitness Worksheets: Worksheet 4—Retirement Saving.

2“The State of the Gender Pay Gap 2020,” PayScale, https://www.payscale.com/data/gender-pay-gap

3“Pew Research, https://www.pewresearch.org/social-trends/2020/01/30/women-make-gains-in-the-workplace-amid-a-rising-demand-for-skilled-workers

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 An article outlining five easy steps you can take to review and enhance your retirement savings that shows a smiling middle-aged couple in their kitchen. The steps include: 1) Revisiting your retirement roadmap, reflecting on your retirement goals and discussing your big-picture retirement vision; 2) Setting your ETA for retirement by revisiting your timeline and possibly setting aside more money each month to reach your goals; 3) Checking the gauge on your savings by visiting your Mutual of America account or using Mutual of America’s online retirement calculators to make sure you’re saving enough; 4) Running a diagnostic on your contributions to ensure you’re maximizing your retirement plan’s value, including whether you’re taking advantage of available employer-matched contributions or participating in catch-up contribution if you’re 50 or older; 5) Fine tuning your investments by reviewing your asset allocation to make sure the mix of funds still aligns with your retirement goals. If you’d like to learn more about your retirement plan, contacting your local Mutual of America representative is encouraged.
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The articles and opinions in this publication are for general information only and are not intended to provide specific advice or recommendations for any individual. Consult your attorney, accountant or financial or tax adviser with regard to your individual situation.