It’s estimated that the U.S. retirement savings deficit is between $6.8 trillion and $14 trillion. But that shortfall will impact women more than men, Sallie Krawcheck said at the 2015 Women's Empowerment Principles Annual Event on Wednesday.
"Let’s begin to acknowledge that the retirement savings crisis is a gender crisis- a women’s crisis," said Krawcheck, the current chair of the professional women's network Ellevate.
Women retire with about two-thirds of the money than their male counterparts, Krawcheck added. But women are living longer than men—sometimes as much as 10 years, according to research. The World Health Organization predicts that a girl who was born in 2012 can expect to live to be around 73 years old, and a boy to the age of 68. And that gap is larger for older generations. “Look around a nursing home, 70 percent are women,” Krawcheck said.
So how to do we solve the problem? Krawcheck—a former president of Bank of Americas’s global wealth and investment division—contended that if the U.S. were to close the wage gap, it would also close about a third of the retirement savings gap. Mandated maternity leave also would also go a long way to solving the issue. Businesses need to stop thinking of mandated maternity leave as a “giveaway,” but an investment in closing retirement savings gap, Krawcheck said.
Society as a whole also needs to stop underappreciating the home-based work women (and sometimes men) perform around family and community life. "We need to think about valuing women's contributions to the economy in the same way- work, parenthood, family," she said, adding that there are no social security contributions for women who stay at home, even though the work they perform is valuable.
But Krawcheck refuted the notion that she “sacrificed” to be in the workforce, rather she sees it as a tradeoff. “I’ve never seen it as sacrifice,” she said, adding that people love a good fight—working women against stay-at-home mothers. “These are just different choices,” she said.