Retirement & Financial Planning Report

Overall lower average salaries for women translate into less financial security in retirement, according to a report from the Democratic staff of the congressional Joint Economic Committee.

Among women ages 65 and older, it said, annual median income from all sources is roughly $11,000 less than among men in the same age group, about $16,000 versus more than $27,000.

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Because Social Security retirement benefits are based on a worker’s earnings over his or her career, the average weekly benefit for female retirees is 78 percent of what it is for male retirees, it said.

Also, women are less likely to receive income from a traditional pension plan, and among those who do, their income is smaller. Payments from these plans are typically calculated based on a worker’s tenure and salary during peak-earnings years and provide a life-long stream of income. Women’s median income from company or union pensions is 53 percent of men’s median income from those sources. Women also receive smaller distributions from federal, state and local government pension plans.

Lower earnings also the affect the ability of women to contribute to defined contribution retirement plans, it said.

Inside the federal government, there is no distinction in eligibility for the defined benefit retirement aspects of FERS and CSRS, however, A recent OPM report said that after taking into account the relative concentration of women in government in lower-paying occupations and at lower levels, there is a pay gap of about 4 percent; however, that gap does not take into account certain other factors, such as years of work experience.