Retirement Age for Women

How Retiring Earlier Affects Planning and Saving

Retired woman sitting with a content look on her face

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It may come as a surprise that women tend to retire earlier than men, even though they’re apt to live longer and work fewer years. It’s the general trend all over the world, including in the U.S., and should be factored in when planning for financial security.

What Is the Retirement Age for Women?

In the U.S., the actual retirement age for women (as opposed to when they’re eligible to receive full retirement benefits) is 66.1, compared to 67.6 for men, according to a 2017 study by the Organization for Cooperation and Development (OECD).

Around the world, the women’s retirement age ranges from 59.4 to 73.1, but the same gender gap of one to two years applies in most of the 36 countries examined by the OECD. Here are the comparisons for select countries:

Average ‘Effective’ Retirement Age by Gender and Country
Country Women Men
Slovak Republic 59.4 60.7
Greece 59.9 61.5
Belgium 60.1 61.7
France 60.6 60.5
Austria 61.1 63.0
Spain 61.6 62.2
Denmark 62.8 64.6
Germany 63.4 63.6
Canada 63.5 66.0
U.K. 63.9 65.0
Australia 64.2 65.5
U.S. 66.1 67.6
Japan 69.3 70.6
Korea 73.1 72.9
Note: The OECD defines the average effective age as the average age of exit from the labor market during a five-year measurement.

Behind the Gender Gap

One reason for the gender gap may be that couples tend to retire around the same time, and women are, on average, two to three years younger than their husbands, according to a 2018 research paper from the National Bureau of Economic Research (NBER).

Another factor may have to do with family responsibilities. Women are more likely to be caregivers for relatives and may time their retirement based on those needs.

The tendency to retire earlier than men underscores the need for careful retirement planning, particularly because women tend to live longer and may not have the same Social Security benefits to fall back on. Women, more likely to stay home to raise their children, have fewer years of paid work and lower lifetime earnings, which affects both Social Security and retirement benefits.

Women: Plan To Live Longer  

The downside to early retirement is greater for married women than men. Ideally, women should be retiring at older ages than men, rather than earlier, according to the NBER research. If you’re a woman and your career was cut short or interrupted, you’re more likely than a man to be leaving the workforce just as your earnings potential is peaking.

However, if you work until you’re 70, the research finds, you’re much closer to erasing the gender gap in Social Security benefits earned.

In the U.S., if you were born in 1937 or earlier, you may begin receiving full benefits at 65, according to the Social Security Administration. The full-benefits retirement age progressively moves higher for younger people—up to 67 for people born after 1960. You may begin drawing as early as 62 but at a reduced amount.

If you’re a married woman expecting to combine your wealth with your husband during retirement, outliving your savings may be less concerning.

But keep in mind that women tend to live two to three years longer. And it’s not uncommon for women to be widows for 15 years or more. It’s generally wise to plan for living until age 85 or 90 to reduce the odds of outliving your savings.

At 65, the average life expectancy is 21.5 years if you’re a woman and 19 years if you’re a man, according to the SSA’s life expectancy calculator. Half of the population will live longer than life expectancy.

Health Care Costs

Health care costs may disproportionately affect women in retirement, not only because they are more likely to have longer periods of disability late in life, but because their husbands’ health care costs may deplete the household savings.

Women who retire before age 65, when Medicare health benefits are available, should also factor in how much the cost of insurance will eat into savings if they’re no longer receiving employer-subsidized coverage.

The Bottom Line

While men and women face many of the same retirement challenges, a longer life expectancy and tendency to retire earlier make planning a different equation for women. Besides taking advantage of individual retirement accounts (IRAs) or employer-sponsored 401(k) plans, women should consider factors such as Social Security benefits, health care costs, and potential caregiving roles.