Planning for retirement can be challenging for anyone, but women face additional obstacles to securing a comfortable retirement. Whether earning less on average compared to men or taking more time off from work for caregiving, women must often navigate several unique retirement challenges. Women's retirement outcomes can also be influenced by social and economic factors such as divorce, widowhood and financial fallout from the COVID-19 pandemic.

8 Challenges for Women in Retirement (or Planning for It)

So what can women do to plan a secure retirement, despite the challenges they face? Here are eight of the most common challenges for women in retirement or planning for it, along with steps to take that can get them closer to the retirement they deserve.

1. The Gender Pay Gap Makes It Hard to Save for Retirement.

One of the biggest retirement challenges for women is the gender pay gap. Women earn roughly 80 cents for every dollar a man makes. That earnings gap follows women into retirement, contributing to a retirement wealth gap that lowers retirement income, the National Institute on Retirement Security says.

The gender pay gap affects retirement savings, too. Because women typically earn less than men, they might not be able to contribute as much to employer-sponsored retirement plans. Earning less over your career also translates to smaller monthly Social Security benefits in retirement.

2. Women Have Been Disproportionately Affected by the COVID-19 Pandemic.

Men and women suffered economic setbacks from the pandemic, the U.S Bureau of Labor Statistics says, but women have borne the brunt of the recession. Women tend to work in the hardest-hit industries, such as restaurants, retail, hospitality and health care, and that affected their ability to save for retirement. Lockdowns and school closings also caused women who work as caregivers to cut their hours. And some lost their jobs.

3. Women Typically Receive Less Retirement Income.

On average, women receive only about 80% of the retirement income that men receive, according to the National Institute on Retirement Security. The institute also found that a woman's household income is only around 83% of a man's median household income while they're in the workforce, and that can drive down women's Social Security benefits. The average annual Social Security income received by women 65 and older in 2019 was only $13,505, according to the Social Security Administration, whereas men received $17,374 on average.

4. Caregiving Eats Into Earnings and Retirement Savings.

The average woman spends nine years away from the workforce caring for children, spouses or aging parents, says the Women's Institute for a Secure Retirement, a nonprofit financial resource for financial education. Women 50 and older who leave their jobs to care for a parent lose almost $324,000 in wages and benefits over their lifetime, the institute says. That time away from the workforce also hinders a woman's ability to contribute to a retirement plan and reduces their Social Security benefits.

5. Women Might Have Less Access to Employee Retirement Plans.

Women are more likely to work part-time than men, and that can leave them ineligible for employer-sponsored 401(k)s or similar retirement plans, the National Institute on Retirement Security says. Because many employers match a portion of their employees' retirement contributions, women who can't participate also miss out on this free money, which helps retirement savings grow.

6. Women Usually Live Longer Than Men.

Women in the United States usually live for 82 years, according to the U.S. Census Bureau; men only live for about 77 years. A longer life expectancy means that women must make their retirement savings last longer. Living longer also increases a woman's risk of needing long-term care — and long-term care costs, which aren't usually covered by Medicare, can easily run thousands of dollars a month.

7. Many Women Aren't Comfortable Investing.

On average, women are less comfortable managing self-directed retirement savings that require decisions on how the money is invested, according to a 2020 report from the Federal Reserve. The report found that only 32% of women felt comfortable managing their retirement investments, no matter their education level. By comparison, 58% of men with at least a bachelor's degree were mostly or very comfortable making investment decisions.

8. Older Women Are More Likely to Live Alone.

Most married women live the last years of their lives as widows, according to a report from the University of Michigan Institute for Social Research — sometimes up to 15 to 20 years.

"Depending on how well the couple prepares, widowhood can put some women at risk of financial strain or even poverty," the study says.

Divorce can also affect retirement plans. It can reduce a woman's household income and their ability to contribute more to their retirement savings — and could even postpone their retirement.

Facing Women's Retirement Challenges Head-On

Despite these challenges, there are steps women can take to secure a more comfortable retirement.

• Determine the best age to start collecting Social Security. Most people can begin collecting Social Security retirement benefits at 62, but doing so reduces your monthly benefit by around 30%, the Social Security Administration says. If you can, delay drawing Social Security benefits until your full retirement age so you can receive more each month for the rest of your life. The Social Security Administration's retirement benefits estimator tool can help you determine what your benefits would be at any age.
• Participate in an employer-sponsored retirement plan. If you aren't enrolled in your company's retirement plan, enroll now. If you're already enrolled, consider increasing your contributions to put more toward your retirement.
• Expand your investing knowledge. Learning more about investing and investment strategies can help you manage self-directed investments and retirement plans. There's a wealth of knowledge available on this site, and on the U.S. Securities and Exchange Commission's educational resource, too.
• Consult a professional. An investment adviser, broker, financial or retirement planner can advise you on investment and retirement planning decisions to keep your retirement goals on track. If you've never worked with one, the SEC offers tips on getting started.

Note: The Top Women Financial Advisors program is a Bankers Life internal incentive awarded to top performing women financial advisors based certain defined criteria.