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Women, especially younger ones, are taking retirement saving seriously, surveys show

Oh, girls just wanna have…funds?

Maybe those aren’t the exact words of Cyndi Lauper’s 1983 hit, but it sums up recent studies showing that younger women are stepping up when it comes to investing and are hopeful when it comes to their financial future.

Let’s start with the takeaway from new research from Fidelity Investments. This year, there has been a heady 48% growth in new women customers opening individual accounts, compared to 2019.

Six in 10 women now invest in the stock market outside their employer-provided retirement accounts, according to the survey. Break that statistic down by age, and the youthful exuberance about the stock market emerges.


Read more: Retirement planning: A step-by-step guide

The study shows that 71% of Gen Z women are investing in stocks and stock mutual funds, as are 63% of millennials, and 55% of Gen X and 57% of baby boomers.

That confidence is heartening.

The women surveyed by Fidelity have also buckled down with their retirement savings. The retirement savings gap has improved since 2019, according to the findings. Nearly 7 in 10 women (68%) are saving for retirement vs. 77% of men. That compares to 66% of women vs. 82% of men five years ago.

The results were pulled from a sample of 2,020 adults 18+ including 994 men and 1,002 women between July 21-26.

A young woman is throwing around a lot of dollar bills. Lottery winning concept.
(Getty Creative) (SimpleImages via Getty Images)

"The big story to me is that the pandemic was a catalyst for women to do more with their money," Lorna Kapusta, head of women and engagement at Fidelity, told Yahoo Finance. "Women are investing now more than ever with Gen Z women leading the way."

That said, this is less about men versus women and more that women are closing the gap and getting more involved in their finances, which is encouraging to see, Kapusta added.

Another bright finding by Fidelity is that women are pretty chill when markets tank. More than half (51%) of women who invest in the market say they typically stay the course on their investments when the market experiences a dip, compared with 43% of men.

But there is another side to that hold-their-horses approach. Only 16% of women surveyed said they use down markets as a buying opportunity, versus 28% of men.

Fidelity Investments
Fidelity Investments (Fidelity Investments)

That steady, no-rash-moves approach to investing syncs with women generally being more conservative in their money management. In the past year, more than a third of women (34%) responded to economic uncertainty by keeping more of their savings in cash with 15% moving cash savings into money market funds where they earned higher interest, according to the study.

Read more: The best money market accounts for November 2023

A recent survey by Northwestern Mutual is equally encouraging when it comes to women investors and savers stepping up to the plate.

Nearly 6 in 10 Gen Z women (59%) believe they will be financially prepared for retirement – a sharply higher cohort than reported by women in other generations: millennials (43%), Gen X (38%), and boomers and older (48%).

They aren’t saying they know it all, however, and are clear-eyed about needing help. Roughly 8 in 10 Gen Z (79%) and millennial women (76%) said their financial plan needs improvement and could benefit from advice.

The 2023 Planning & Progress Study was conducted by The Harris Poll on behalf of Northwestern Mutual among 2,740 US adults aged 18 or older, between Feb. 13 and March 2.

While these two reports give us plenty to cheer about, there is another side of the page to consider. In general, women still face headwinds when it comes to saving for retirement. Three in 4 women (75%) are saving for retirement through employer-sponsored plans such as a 401(k), IRAs, mutual funds, or bank accounts, compared with 81% of men, according to a survey report out this week by nonprofit Transamerica Center for Retirement Studies in collaboration with Transamerica Institute.

Read more: These are the new traditional IRA and Roth IRA limits in 2024

And they’re starting later than their male counterparts. Among those who are saving for retirement, women started saving at age 27 (median) and men started saving at age 26 (median).

Even a year's lag can make a difference decades down the road when you consider the power of compounding interest and reinvested dividends.

Transamerica Center for Retirement Studies (Transamerica Center for Retirement Studies)

And worse yet, women workers (74%) are less likely than men (78%) to be offered an employer-provided 401(k) or similar retirement savings plan, according to the findings. About a quarter of women workers (22%) are not offered any retirement benefits by their employers, compared with only 16% of men.

That discrepancy is due in some measure to the fact that women are more likely to work in part-time contract jobs and many employers don’t offer benefits to their part-time employees.

Women are twice as likely as men to work part time (16% and 8%, respectively). Only 45% of women who work part time are offered a 401(k) or similar plan compared with 79% of women employed full time.

"These factors impair a woman’s lifetime earnings, retirement savings, and government and employer benefits," Catherine Collinson, CEO and president of Transamerica Institute, a nonprofit private foundation, told Yahoo Finance. "On top of these factors, statistically, women live longer than men, so they have an even greater need to save for older age."

The survey was based on interviews with 5,725 US adults age 18 and older, who work full time or part time for a for-profit company employing one or more employees, including 2,907 women and 2,766 men.

"The good news in this data is that younger women are feeling more confident about their financial future," Veronica Fuentes, a certified financial planner and a Northwestern Mutual managing director, told Yahoo Finance.

Echoing Fidelity’s Kapusta, Fuentes added, "these younger generations of women want to take greater control and that gives me a lot of optimism."

Kerry Hannon is a Senior Reporter and Columnist at Yahoo Finance. She is a workplace futurist, a career and retirement strategist, and the author of 14 books, including "In Control at 50+: How to Succeed in The New World of Work" and "Never Too Old To Get Rich." Follow her on Twitter @kerryhannon.

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