In spite of earning less than their male counterparts, American women retire earlier on average, according to recent data. While women face a gender-related wage gap, earning just 82% of what men earn in similar roles, statistics show that they retire around two years earlier than men.
Analysis from the US Census Bureau reveals that the average retirement age for women in 2016 was 63, compared to 65 for men. Forbes reports that as of 2021, the average retirement age is 65 for men and 62 for women. This indicates that women continue to retire even earlier than men as time goes on.
In 2022, a Gallup poll revealed that the average age of retirement for men and women has increased from 57 to 61 years old. Additionally, the Retirement Confidence Survey states that the median retirement age for both men and women is 62, despite many individuals intending to delay retirement until age 65.
Various factors contribute to the decision to delay retirement, including healthcare costs. Some Americans wait until age 65, as Medicare covers at least some medical expenses. According to Fidelity Investments, a retired couple aged 65 can expect to spend roughly $315,000 on healthcare during their retirement.
Delaying retirement until Full Retirement Age or beyond can also maximize Social Security benefits, providing increased income in later years. If you were born in 1960 or later, the full retirement age is 67. Furthermore, waiting until age 70 to begin collecting Social Security allows one to receive 132% of their Full Retirement Age benefit amount.
However, many people, especially women, retire earlier than planned due to circumstances beyond their control. The Goldman Sachs Retirement Survey & Insights Report reveals that 60% of women retired earlier than they intended, with 66% attributing their retirement to factors outside their control.
Such factors include health issues, the need to care for family members, and involuntary job loss. Women make up approximately 75% of unpaid caregivers to spouses, aging parents, or other seniors. These caregiving responsibilities often impact their ability to continue working.
Michigan Retirement and Disability Research Center researchers suggest that early childhood trauma can lead to chronic illness, mental health problems, obesity, and risky health behaviors in adulthood. These conditions may contribute to earlier-than-planned retirement for both men and women.
As women continue to face the gender wage gap and various caretaker roles, understanding the factors influencing early retirement can help address disparities and inform policy decisions.