Female Gen Xers at Risk

Art by Julianna Brion

A cut of data about Generation X from the Employee Benefit Research Institute (EBRI)’s Retirement Security Projection Model (RSPM)—which can assess the size of households’ retirement deficit by modeling retirement savings shortfalls (RSSs) found the retirement deficit—or additional savings required to meet basic needs in retirement—is higher for both widows and single females than for widowers and single males.

The average RSS is $18,476 for married households where the female dies first, leaving a widower; the average RSS is $22,783 for married households where the male dies first, leaving a widow. In contrast, the average RSS is $37,690 for single males and $72,883 for single females.

According to the analysis, single Gen X females are the only cohort where at least 50% of households have a deficit. The median RSS for this group is $19,900, and 10% of single females have an RSS of at least $222,592.
Nearly half (48%) of single females at the lowest income quartile have at least a $100,000 RSS, which connotes serious potential financial complications in retirement. This compares to one-third of single males and 42% of widows.

Even in the highest income quartile, 13% of single females have an RSS of at least $100,000 vs. 7% for single males, 4% for widows and 3% for widowers.
Defined contribution (DC) retirement plan eligibility helps with the shortfalls. Single females with no future eligibility to join a defined contribution plan have an average RSS of $97,325 vs. the $24,486 average RSS of those with at least 21 to 30 years of future eligibility.

The average RSS is $39,016 worse for single females than for single males with no future DC plan eligibility. The discrepancy in the average RSS between widows and widowers with no future DC plan eligibility is $6,529.

Boomers Confident

Seventy-five percent of Baby Boomers think they will have enough money to live comfortably in retirement, but this is true for only 35% of Gen X, according to a new report from Retirement Living, “Retirement Preparedness Study 2019: Baby Boomers vs. Generation X.”

Boomers rely primarily on pensions and 401(k) plans, while Gen Xers look to 401(k)s and individual retirement accounts (IRAs). Both Boomers and Gen Xers factor Social Security into their saving equation.

Fifty percent of Baby Boomers and Gen Xers have saved or are on track to save $700,000 or less. Boomers think that is adequate savings, while members of Generation X do not.

The survey found that 65% of Boomers saving for retirement are men and 35% are female. Among Gen X, this is evenly split at 50% for each sex.