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Helping Millennial Women Close the Retirement Savings Gap

Plan Sponsors Have an Opportunity to Provide Engaging and Relevant Financial Education that Resonates with Women.

Key Insights:

  • Recent data show that the retirement savings of millennial and baby boomer women continue to lag behind their male peers.
  • Millennial women make less money than their male counterparts, but have similar levels of debt. Given this income difference, debt may affect women more harshly.
  • Millennials look to their workplace plan as a top source for financial advice. Women place a higher value on advice that's convenient and easy to use.

The wage gap and lifetime income gap between men and women presents many challenges for those preparing for retirement.

Recent research from T. Rowe Price1 finds that while there is slight progress among women saving for retirement, the gap between men's and women's retirement savings persists; a likely follow-through resulting from lower lifetime earnings.

In a nutshell, women's lower salaries + lower contribution rates = lower retirement account balances. 
- Judith Ward, CFP(R), Senior Financial Planner

Greatest Disparity: Working Baby Boomer Women

Graph for working baby boomers women

At some point in retirement, women may be solely responsible for their finances--whether by choice or not.

  • Our survey found that within the first 5 to 10 years of retirement, one-third of women (33%) were either widowed or divorced, compared to 17% of men.
  • After 11 years of retirement, the number of widowed or divorced women increased to 45% while the number of men who were widowed or divorced barely changed (18%).

We found that working baby boomer women are contributing less to their 401(k)s than men--a median of 7% compared with 10% for men.

  • Lower salaries, along with contributing less, resulted in a median 401(k) account balance of $58,700 compared with $138,200 for similarly aged boomer men.

The Gap Between Men's and Women's Finances Emerges Early

The Gap Between Men’s and Women’s Finances Emerges Early

  • Similar to past trends, our study found that millennial women make less money than their male counterparts--a median annual income almost $30,000 less than the median for men.
  • While women we surveyed have seen a slight income increase over the last three years, that hasn't translated into them saving more.

Beyond the 401(k) plan, Our Study Uncovered Other Differences Between Men and Women that May Affect Their Financial Futures.

A. Career choice may be one factor responsible for the income difference between men and women

  • More women--roughly three times the number of men - were employed in the health care and social assistance field where the average annual salary is $45,655.2
  • In contrast, men were twice as likely to work in the information industry, where the average annual salary is $72,640.2

B. Women have more difficulty contributing

C. Given the income difference between millennial men and women, debt levels may affect women more harshly even though both had similar types of debt and outstanding balances

  • Three-quarters of millennials had credit card debt. The median outstanding credit card balance is approximately $3,000.
  • Nearly half of millennials had a car loan. The median outstanding balance is approximately $12,000 for men and $13,000 for women.
  • Almost one-third of millennials have student loans. The median outstanding balance is around $17,500 for men and $15,600 for women.

Opportunities for Financial Education

  • Be firm in a recommended savings amount.
  • Emphasize that a retirement plan's default deferral rate is a starting point--not a final destination--when it comes to saving.
  • When it comes to education and advice, it's all in the delivery.

Women prefer financial advice that:

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Is easy to use


Fits into
their schedule

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Has alerts, motivation
to stay on track

Abour Our Study

T. Rowe Price engaged NMG Consulting to conduct a national study of 3,005 adults aged 21 and older who have never retired and are currently contributing to a 401(k) plan or are eligible to contribute and have a balance of at least $1,000. We surveyed an additional 1,005 who have retired with a Rollover IRA or left a balance in their 401(k) balance plan. The online survey was conducted from July 24, 2018, to August 14, 2018. This is the fourth in a series of participant surveys, and data from prior surveys is used in this report for comparison purposes.


1. The Retirement Savings and Spending (RSS) study is a nationally representative annual survey of workers ages 21 and above who are either currently participating in a 401(k) plan or eligible to participate and have a plan balance of at least $1,000. Along with 3,000 workers, the 2018 RSS study also includes a sample of 1,000 retirees who had a Rollover IRA or a left-in-plan 401(k) balance.

2. Bureau of Labor Statistics, U.S. Department of Labor, Current Employment Statistics (National), on the Internet at (visited April 2019).

Contact your T. Rowe Price representative to find out how we can take your plan to the next level.