Retirement Savings: 4 Tips for Women To Boost Long-Term Savings

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Many women are currently focused on saving for retirement, with over one-fifth of women (21%) stating that this is their primary financial goal, a recent GOBankingRates survey found. It’s the No. 1 goal for women who are nearing retirement, with 30% of women ages 55 to 64 stating that saving for retirement is their primary financial goal.

Yet many women are struggling to reach their financial goals, with 53% of women citing a lack of money as their biggest barrier and an additional 18% stating that a combination of a lack of money and lack of knowledge are standing in their way. Fortunately, saving for retirement doesn’t have to be complicated, nor does it require a lot of money to get started.

In this “Financially Savvy Female” column, we’re chatting with Leslie Thompson, CDFA, CPA, CFA, chief investment officer and co-founder of Spectrum Wealth Management, about the top tips for women who want to boost their retirement savings.

Be Mindful About Your Spending

Over half of women believe that they don’t have enough money to reach their financial goals, but the reality is that many of those women are spending money that would be better put toward retirement savings.

“For anyone, it’s really important to get a handle on what your spending is,” Thompson said. “People tend to spend more than they think that they do.”

She recommends using tracking software or an app to see exactly how much you are spending and on what.

“People have subscriptions that they forget about, or [other] spend that that’s maybe unnecessary,” Thomspon said.

Once it’s clear what spending is nonnegotiable and what you can cut back on, you may find “extra” money you didn’t even realize you had.

Pay Yourself First

After accounting for nonnegotiable spending — such as housing, food, transportation and healthcare — start regularly setting aside money for your retirement savings.

“Pay yourself first,” Thompson said. “Have monies go into [retirement savings] directly from a paycheck. If you don’t see it, then you’re able to manage without that ‘extra’ money.”

Automatically contributing to your retirement savings takes out the guesswork about what to do with those funds.

“I think the stumbling block for a lot of women is that if their bank account starts to accumulate some money, then they have to make a decision,” Thompson said. “People get lost in those details. Anything we can do to simplify your financial life will allow people to feel more confident about how to save.”

Take Advantage of Your Employer-Sponsored Retirement Account

If you have access to an employer-sponsored retirement account, such as a 401(k) or 403(b), make sure you are utilizing it.

“If women are working, definitely set aside money in an employer’s retirement plan account,” Thompson said.

Many of these accounts offer a matching contribution, so not taking advantage of this is leaving money on the table.

Invest In a Brokerage Account

Ideally, you should also be contributing money to other accounts as well.

“Make sure that there’s an adequate liquidity pool outside of a structured retirement plan, because there are potential penalties for pulling money out if you’re under 59 1/2 with those types of accounts,” Thompson said. “If people truly want to invest long term so they have that liquidity pool covered, establish a brokerage account and use dollar-cost averaging into mutual funds or exchange-traded funds each month or every other week, whatever the case may be.”

Even if you can’t contribute a lot to begin with, these accounts will grow over time.

“By even starting a small dollar cost average, it’s amazing how money compounds,” Thompson said. “Get that process started, no matter how small, and the wealth does accumulate over time.”

Methodology: GOBankingRates surveyed 1,001 American women ages 18 and older from across the U.S. between April 18 and April 20, 2024, asking 18 different questions: (1) What is your primary financial goal?; (2) What is the biggest barrier to achieving your financial goal?; (3) If you are actively investing, what is your primary investment vehicle?; (4) If you are not actively investing, what’s preventing you from investing?; (5) How much student loan debt do you currently have?; (6) How much credit card debt do you currently have?; (7) What is your biggest obstacle to paying off your debts (credit card, student loan, medical, etc.)?; (8) What is your biggest source of financial worry/stress?; (9) What is your worst money habit?; (10) How involved are you in household financial decisions compared to your partner?; (11) Which of the following financial professionals have you utilized? (Select all that apply); (12) Do you consider yourself financially secure/stable?; (13) What is your biggest financial regret?; (14) Do you consider yourself bad with money?; (15) How would you describe your relationship with money?; (16) Do you consider yourself to be financially independent?; (17) Which ways do you live frugally? (Select all that apply); and (18) What actions are you taking to build long-term wealth? (Select all that apply). GOBankingRates used PureSpectrum’s survey platform to conduct the poll.

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