A retirement guide for women that the Heinz Family Philanthropies and the Women's Institute for a Secure Retirement issued last week brought to light some startling facts.

Two-thirds of working women earn less than $30,000 a year, most earn only 77 cents to a full-time working man's dollar, and the employers of nearly half don't offer any 401(k) plan.

In retirement, women have significantly less than men to live on; the median income in 2004 for retired women was a paltry $12,080, compared to $21,102 for men. For nearly one-third of non-married women over the age of 65, Social Security is their only source of income, and because women earn less than men, their Social Security checks are invariably smaller. In fact, the largest growing segment of the U.S. population is poor, elderly women. Twenty percent of single white women over the age of 65 live in poverty; for African American and Hispanic women, the figure is 40%.

The main problem many women face in preparing for retirement is that they are frequently the caregivers in their family, raising children and tending to elderly parents, and as a result, are out of the workforce for many years, if not decades, and unable to save. On average, women spend 27 years in the workforce, while men spend about 40. Compounding this problem is the fact that women live, on average, six years longer than men, to 80 years of age.

So how can the guide, What Women Need to Understand About Retirement, possibly suggest that women can juggle caring for their families and preparing for possibly 30 years in retirement?

The guide emphasizes first and foremost that women must take it upon themselves, no matter what their other obligations, to save for retirement. Should they be working at a job that doesn't offer a 401(k) plan, they should open an individual retirement account.

Women must also realize that they are probably going to live several decades in retirement and will have high healthcare costs. While most advisers' rule of thumb is to plan on replacing 70% of one's income in retirement, the guide says it's better to bank on 100%. In addition, the guide strongly suggests women seek professional financial advice, rather than relying on friends and family

(c) 2007 Money Management Executive and SourceMedia, Inc. All Rights Reserved.

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