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Smart moms retire comfortably

By Jennie L. Phipps ·
Thursday, March 6, 2014
Posted: 3 pm ET

For many women, retirement planning is a tough challenge, especially when it is based strictly on their own resources.

"Women in general -- single and married -- have lower lifetime earnings than men because of lower salaries, time out of the workforce and less opportunity to save," says Catherine Collinson, president of Transamerica Center for Retirement Studies, a nonprofit foundation. "One of the things that I particularly want to point out: Women are more likely than men to work part-time, and part-time workers are less likely to have retirement benefits."

In a recent national survey of men and women workers, Transamerica found:

  • Only 7 percent of women are "very confident" in their ability to fully retire and live comfortably.
  • Fifty-two percent of women plan to work after they retire.
  • About 43 percent of women expect to work past age 70 or never retire.

If this sounds like you, Collinson says right now is the time to develop a better plan. Start by figuring out what it will take for you to live comfortably in retirement. "The scariest step of all is calculating a savings goal. Use an online calculator and brace yourself. When the number comes back, it is going to be shockingly big -- almost an out-of-body experience," she jokes.

Once you know your number, then you can develop a plan. Here are some other things consider:

Don't be such a giving mom. Don't automatically step up to assume the caregiving jobs that will take you out of the workforce without considering the impact of this move on your retirement planning. Weigh the trade-offs and other options that would mitigate the impact on your long-term security. Could somebody else help? Would hiring help be cheaper in the long run?

Pay isn't everything. Think about retirement security as part of your current compensation. If your employer offers a 401(k) or other retirement plan, participate at least to the extent that you get the full employer match. To do otherwise is to leave money on the table, and you don't want to do that.

Review your Social Security options. Divorced spouses who haven't remarried can claim on their former spouse's earnings record, as long as they were married at least 10 years. Explore that and other options that could raise the amount you get every month. Just working a few more years can make a big difference in the size of many women's checks.

Talk about retirement with friends and family. There are a lot of women in the same boat. Sharing your plans, your fears and your dreams may result in the development of a good idea.

See if you qualify for the saver's credit. The IRS rewards some individuals -- those with low to moderate incomes who save for retirement -- with a tax credit worth as much as $1,000. In other words, Uncle Sam will pay you to save. Don't turn it down.

Buckle down and save more. Look for ways to put more money into your retirement account.

Study up on retirement investing. The more you understand the options, the better the chances that your money will earn a decent return, and the safer you'll feel about your investments and your future.

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May 26, 2014 at 9:43 pm

I am 68, and I have no plans to retire yet. I still work as a
Personal Trainer, and also work for a Wellness Company that allows
me to work from home. This is going to be a part of my retirement
from Personal Training, but I can work from home with the Wellness
Company for a lifetime.

I get residual income, and it will at some point be better than my
SS check.

I am blessed, as I take risks, and I am not afraid to work.

May 26, 2014 at 2:42 pm

I agree with Tiffany. "Don't be such a giving mom" is outrageous! It discounts our children as being unimportant to our retirement. Children need their mothers and the best way to invest in the future of your family is to invest in them. Whether you're working in the home or outside it, take the time you have with them to help them learn to be responsible by example. Help them learn they can achieve things on their own, but that you will be there if they need you. This teaches them, in turn, to be there for the ones they love. If you do this, when you need them they will be there for you as you were for them.

Pat S
May 26, 2014 at 12:49 pm

Please don't judge the "working Mom" unless you have been in their shoes in exactly the same way and even then personal life history will cloud the facts. Judge not, you don't want to be judged or criticized. Often, multiple children will all turn out differently, with all the same treatment.
As far as leaving jobs, never take out your contribution portion of retirement, no matter how small, even if you "think" you will never work for them or anyone again. You can draw a small check in retirement, and if you do go back to same organization, it will be there to add to current contribution and if certain number of years are required to retire, those early years will generally be included.

May 26, 2014 at 10:28 am

there are jobs out there for retires but you have to create them or look for things that suit you. after retiring at age 66 i knew i had to still be doing something. i started watching pets in my home also going to the pets house at times when needed. it has been a great part time job, not getting rich but the extra $$$ do come in handy. i understand in new York city dog walkers are in great demand. I'm sure in other large city's its the same. but then you do have to be a dog/cat lover.