Women worried that leave may ruin their retirement prospects

It's been a case of role reversal for many American families today. Fathers - who have long been considered the breadwinners of the household - are more frequently assuming the mantle of caretaker. Meanwhile, women head to the office to provide the material support.

On the whole, however, many women are still doing double duty, working for a living outside the home while also raising a family. It seems, though, that a number of newly minted mothers are worried that by taking an extended leave after giving birth, they'll wind up compromising the retirement savings they've compiled, a new poll suggests.

Approximately 50 percent of women today say they have taken an extended leave of absence from their workplace in order to take care of personal responsibilities at home, according to a recent survey conducted by worldwide research group LIMRA. Of these, half admit that they can't help but wonder if by doing so they'll adversely impact their ability to retire comfortably.

Cecilia Shiner, LIMRA Secure Retirement Institute assistant research director, indicated there's sufficient cause for women to have stress in this regard.

"When women disrupt their employment to take care of family members it usually has a negative impact on their overall retirement savings levels and has the possibility of reducing their Social Security benefit," Shiner explained. "This study was designed to quantify one of the challenges facing working women trying to prepare for retirement and highlight ways they can compensate for the lost income if they do have to temporarily leave their job to care for a loved one."

30 percent worried about benefits being cut
Outside of salary, employee benefits are among the most highly sought after perks that come with full-time employment, as business owners frequently provide various provisions, like health insurance, retirement benefits and 401(k) opportunities. Almost one-third of workers - 30 percent - say they're worried about their benefits being reduced at some point, according to a survey done by Gallup. That's substantially higher than the 19 percent who stress about having their wages trimmed, whether due to company cutbacks or poor performance.


There are roughly 44 million caregivers in the U.S., all unpaid, according to estimates. There are roughly 44 million caregivers in the U.S., all unpaid, according to estimates.

Extended leave - and the impact it can have on retirement income - isn't solely found among women who are taking care of newborns. It also affects women who are providing for their parents who are experiencing age-related decline. In fact, the LIMRA poll revealed that over 50 percent of millennials who are caretaking for elderly loved ones have compensated by putting more money into their retirement coffers.

UN: 1 in 4 Americans over 60 by 2030
Caretaking for fellow family members is expected to increase as the world gets older. By 2030, approximately 25 percent of Americans will be older than 60, according to numbers maintained by the United Nations.

"As our population ages, the demand for caregiving will increase," Shiner said. "If history is any indication, much of this will fall on women."

She added that based on experts' predictions, leave could wind up costing family caretakers over $324,000 combined in wages and Social Security income for women 50 years of age and older who have to stop working.

Long-term care insurance is one of the ways that individuals can finance the cost of caretaking. However, this doesn't account for maternity leave. Leveraged Planning® Solutions serve as a financial strategy that can help fund caretaking responsibilities. For more information on this life insurance-based approach to financial planning, speak with a GFD Financial Services Manager.

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