Patrice Willoughby, Women’s Institute for a Secure Retirement Board Member, joins Yahoo Finance to discuss steps women can take to save for retirement.
- Welcome back to today's edition of Funding Our Future. We all know we should be saving for retirement, but a recent survey of 42-- a recent survey found 42% of women are only able to cover day to day expenses. The Women's Institute for a Secure Retirement or WisR has been helping women save for retirement for a quarter century, and board member, Patrice Willoughby. Joins us today.
Patrice, thank you for being here. I guess the pandemic-- let me put it this way, if saving for retirement was difficult before, the pandemic has definitely thrown a wrench into a lot of people's plans, especially when you consider all the changes in the workplace and the disproportionate burden that women now face in terms of child care and other matters. I'm just wondering what are some of the strategies that you're helping teach people to save for retirement here.
PATRICE WILLOUGHBY: Jared, heard first of all, thank you so much for having us on today. As you mentioned, WisR is celebrating its 25th anniversary this-- this week. And our focus uniquely is the challenges that women face in retirement. I think the pandemic year has really revealed some of the problems that women face in having to separate and also being sandwiched between child care and also, potentially elder care responsibilities. WisR has been focusing on these issues for about 25 years, and there are a number of tools and educational materials that are on the WisR website at wisr.org.
But I think that some of the specific steps that people can take are to begin early. To set aside small amounts of money for an emergency fund. We all know that emergency expenses can have an effect on your financial well-being. And also, to take advantage of every opportunity to save through employer-provided retirement accounts.
- Now it may be stating the obvious, but let's talk about some of the challenges, in particular, what are that they face that sometimes men do not face?
PATRICE WILLOUGHBY: Oh, certainly. So women live longer than men. And so that in itself means that women have to have their retirement savings last for a longer period of time. We also have fewer years of earned income often because of child care and elder care responsibilities. Women who separate from their work life in midlife lose on average $300,000 in both salary and retirement and social security benefits. So those are issues to think about when facing the challenge of caregiving.
We also earn less on average for comparable work, which means that we make significantly fewer retirement benefits than men. And we're also more likely to work part time. All of those factors can have an effect on women, women's retirement security in later life.
- We talk a lot here about the wealth gap and especially the racial wealth gap. When you break it down by demographics, are there different strategies you're using and teaching to help people of different ethnicities face their unique burdens here?
PATRICE WILLOUGHBY: Certainly, I think it's really important. And WisR has focused on meeting women specifically where they are. We partner with a lot of community groups. For example, we worked with MANA, which is a national Latina organization, to discuss our Latina savings project. And this is a model program for increasing emergency savings among low to moderate income Latinas, because financial security includes not only long-term security, but also those emergencies that pop up.
We have also conducted projects for low and moderate income workers. And we found that people who are interested in savings will do so when there's a low-- a low cost and easily accessible savings account, which is partnered with an incentive to save. So it's important to think about all of those different ways in which you can meet people where they are and make it easy for them to save.
We also know that younger people are very interested in being technologically oriented, and engage with their financial systems most often through financial apps. They want their financial institutions to provide that, because that's one way of reaching them to encourage them to save for retirement.
- Well, Patrice, we thank you for sharing your thoughts on this very important issue. Patrice Willoughby, Women's Institute for a Secure Retirement, that is WisR. And we thank you again for joining us.