The State of Women 2022
5 minute read
In partnership with HerMoney, a digital media company, started by personal finance expert Jean Chatzky, focused on improving the relationships women have with money, the Alliance released the fifth chapter of new research, The State of Women 2022.
Two-thirds of Women See a U.S. Recession Ahead, but Plan to Double-down on Retirement Savings
After years of making progress on closing gaps, climbing ladders and shattering ceilings, we’re learning (and hearing) how the pandemic has set women back. That’s why the Alliance and HerMoney went straight to the source to survey The State of Women in 2022.
The fifth chapter of the State of Women in 2022 released on November 14th, looked closely at women’s economic outlooks and reveals some of the trade-offs they’re willing to make to remain in control of their financial futures.
The study found that over two-thirds (68 percent) of women see a U.S. recession ahead. However, in these uncertain times—when just two percent say they doubt or don’t believe a recession is imminent—women are doubling down to secure their financial futures.
Highlights from the study include:
- 92 percent of women plan to maintain, or even increase, their contributions to retirement accounts, including 401(k)s or IRAs.
- Only five percent of women would borrow for big purchases, while seven in ten
- (71%) say they will put off big purchases entirely and another quarter (24%) would only pay cash.
- Four out of five women (80%) prefer making the financial decisions themselves versus deferring to a decision-making partner. This is the same whether currently partnered or single.
- An overwhelming 83 percent (83%) of working women would choose a portfolio with reliable retirement income over a risky portfolio with potential for higher returns – jumping even higher, to 88 percent (88%), among Baby Boomers.
This online study was conducted from October 4 to October 17, 2022 among over 1,100 women who are members of the HerMoney community. They range in age from 18 to over 75, most are college-educated and employed full-time. Nearly two-thirds are married or partnered.
“Women have told us time and time again that they prioritize saving and have peace of mind when they know they have enough protected income to last throughout retirement.”
-JEAN STATLER, CEO OF THE ALLIANCE FOR LIFETIME INCOME
To learn more about the findings from Chapter 5, visit the links below:
Inflation Risk is the Top Financial Concern for Nearly Three in Four Women
After years of making progress on closing gaps, climbing ladders and shattering ceilings, we’re learning (and hearing) how the pandemic has set women back. That’s why the Alliance and HerMoney went straight to the source to survey The State of Women in 2022.
The fourth chapter of the State of Women in 2022, released on August 3rd, focuses on women and financial worries and looked closely at women’s relationship with various financial risks in their lives and their investment portfolios.
The study found that inflation risk tops the list of women’s financial concerns, with 73% of women are worried about inflation, their top financial fear, ahead of illness or disability, market volatility, longevity (58%) and unemployment (43%). Yet, only two in five women (41%) say they know how to protect themselves from inflation risk.
Other highlights from the study include:
- Low levels of inflation preparedness are evident across income levels – even among the highest-earning women.
- Nearly nine out of 10 (87%) believe that not ensuring your money lasts a lifetime is a bigger risk than not enjoying the money you have now (13%).
- Notably, only 12% of women consider themselves to be risk averse when it comes to investments.
Inflation protection can be boiled down to a few key steps:
- Prioritize paying off any high interest rate debt.
- Delay taking Social Security to increase your monthly take.
- And maintain a diversified investment portfolio for growth, while using annuities or pensions to cover your fixed costs in retirement. It’s also a good idea to keep an eye on where your money is going to keep a lid on unnecessary and impulse spending.
The fourth chapter of the State of Women 2022 was conducted as an online study from June 14 to July 11, 2022, among over 1,100 women who are members of the HerMoney community. They range in age from 18 to 75, most are college-educated and employed full-time. Nearly two-thirds are married or partnered.
“Women embrace risk in the market but should also realize ways of protecting their future selves.”
-Jean Statler, CEO of the Alliance for Lifetime Income
To learn more about the findings from Chapter 4, visit the links below:
Less than half of women know how to make their money last in retirement
The third chapter of the State of Women 2022 was conducted as an online study in March 2022 among over 1,000 women who are members of the HerMoney community. They range in age from 18 to 75, most are college educated and employed full time. Two-thirds are married or partnered.
The third chapter of the State of Women in 2022, “Retirement Planning,” released on May 18th, focuses on women and retirement.
Findings show that women are taking responsibility of their household retirement planning but making their savings last throughout retirement is presenting a major challenge to their financial confidence. The research shows that while nearly three in four (73%) women know what steps to take to build their retirement nest egg, less than half (47%) know how to make their money last throughout retirement.
Protected income can only come from three sources: Social Security, a pension or an annuity. However, most women surveyed do not associate protected income with an annuity. That lack of knowledge about annuities leads to just 3 percent of women saying purchasing an annuity is extremely important to securing their future.
HerMoney and ALI recommend working with trusted financial professionals who are knowledgeable on retirement income planning. As this research shows, the 44 percent of women who work with a financial professional, are significantly more likely to know the steps to take to make their money last in retirement (58% vs. 39%).
“Women control a third of total US household financial assets today—more than $10 trillion—and $30 trillion more is expected to shift into the hands of US women over the next three to five years. Any financial professional who isn’t thinking daily about how to better meet the wealth management and retirement income needs of American women simply isn’t paying attention. The economic strength of women in our country today is profound, but that doesn’t mean they don’t want advice.”
– Jean Statler, CEO of the Alliance for Lifetime Income
To learn more about the findings from Chapter 3, visit the links below:
Nearly 3 out of 5 of women worry about money several times a month or more
The second chapter of the State of Women in 2022, “Money Worries,” released on April 28th, highlights financial factors causing women the most worry.
The research reveals that nearly three out of five (58%) worry about their finances at least several times a month. 28% of women worry at least several times a week and 14% worry every single day. Only 10% say they have their financial stress completely under control.
Further, younger women and single women feel the pressure more than others.
- Millennials (64%) worry more than Gen Xers
(60%) who worry more than Boomers (51%). - Nearly two-thirds (64%) of single women worry about their financial situations at least several times a month compared to 56% who are partnered.
- About one of every five single women (19%) worry about their finances daily compared to just 11% of those in relationships.
The State of Women in 2022 study also identified the top three things that would alleviate stress about money:
- Achieving a milestone investment amount (43%)
- A pension or investment that provides an income for the rest of my life (40%)
- A 20% bump in salary (40%)
“After years of debating the effectiveness of financial literacy, it’s clear that it has one substantial positive — it can help give us peace of mind so we can stop worrying.”
-Jean Chatzky, Alliance for Lifetime Income Fellow and HerMoney CEO
To learn more about the findings from Chapter 2, visit the links below:
Women are taking control of their finances, investments and retirement planning
The first chapter of the State of Women in 2022, “Ms. Financial Independence,” released on April 12th, takes a look at how women are breaking down stereotypes and taking control of their finances, careers and futures.
The research found that financial advisors may be overlooking essential needs of their female clients. Almost all women who reported being in a relationship play a role in managing not only their household finances (94%), but also managing investments (94%) and, contrary to popular belief, retirement planning (94%).
When it comes to women who are partnered, only one-third (33%) have completely merged their finances with their significant other and this trend appears to have staying power. Among women who are currently single, only 2% (2%!) say they would merge all their money with a spouse or partner in the future.
“This research clearly dispels an old belief that women are the CFOs of the household but are somehow absent when it comes to investing and planning for retirement.”
-Jean Statler, CEO of the Alliance for Lifetime Income
To learn more about the findings from the first chapter of the State of Women in 2022, “Ms. Financial Independence,” visit the links below: