Women Gaining On Men In Retirement Savings
March 8, 2013 by PR Newswire Association LLC
SPRINGFIELD, Mass., March 6, 2013 /PRNewswire/ — Fourth quarter 2012 data for defined contribution plans administered by MassMutual shows that women are closing the gap in retirement plan account balances as well as in savings rates compared to those of their male counterparts.
According to the Q4 data, the average deferral rate for female participants was 5.38%, an increase of 1.6% for the quarter. Male participants are saving at 5.81% on average, an increase of 1.2% from the third quarter 2012. MassMutual’s data shows the gap is gradually and consistently closing. Since Q3 2010, when the average account balance among female participants trailed that of men by 40.49%, the gap has been gradually closing (past 10 quarters). In Q4 2012, the average account balance among females was 38.25% behind their male counterparts, an improvement of 2.49 percentage points or 5.6%.
“This is a positive trend and we are so pleased to see slow but steady progress for our participants, especially our female participants,” says Elaine Sarsynski, executive vice president of MassMutual’sRetirement Services Division and chairman, president and CEO of MassMutual International LLC. “We have customized our participant education offering on a number of fronts to drive action among specific segments such as women, and the progress we are seeing indicates that participants are responding favorably,” she adds.
The vast majority (73%) of asset allocation investments for females are in age-based strategies, while men are almost evenly divided between age-based and risk-based strategies, at 52% vs. 48% respectively.
Loan activity among MassMutual’s participants is well below the industry average, indicating the company’s call center representatives and educational programs are successfully communicating that taking a loan from a retirement vehicle should be a last resort. The percentage of participants in plans administered by MassMutual taking any kind of loan or withdrawal is the lowest of any 4th quarter in the past five years.
As might be expected, average balances and average deferral rates are highest for the Silent Generation (born 1945 and earlier) and Baby Boomers (born 1946 – 1964). Combined, Generation Y and Generation X participants (born between 1965 and 1995) represent 56% of total participants and 32% of defined contribution assets. While GenX/Gen Y participant numbers are higher than the Baby Boomer count at 40% of participants, Boomers still have a greater share of the overall assets at 61%, but that gap, too, is closing.
MassMutual serves approximately 3 million participants. For more information regarding MassMutual Retirement Services, please call your retirement plan professional or contact MassMutual at 1-866-444-2601.
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