Most women intend to sustain or boost their contributions to 401(k)s and IRAs, regardless of a potential U.S. recession.

Research indicates that over two-thirds (68 percent) of women anticipate a recession in the U.S. However, amidst these challenging times, they remain committed to fortifying their financial futures. In fact, 92 percent are determined to sustain or even elevate their retirement account contributions, including 401(k)s and IRAs, as highlighted in the fifth chapter of the "State of Women in 2022" report.

“Even with recession fears looming, women are not allowing that to derail their long-term financial ambitions,” remarks an expert from the Alliance for Lifetime Income. “A significant number are ready to ‘double down’ on their investments, adopting a mindset that now is the right time to invest.”

If a recession does occur, women are willing to be prudent in other areas. Only five percent would consider borrowing for substantial purchases, while 71 percent plan to postpone major expenditures altogether, and 24 percent would opt for cash payments only.

Women Taking Charge

Approximately 80 percent of women prefer to handle their financial decisions independently rather than relying on a partner. This preference holds true for both singles and those in relationships. Nonetheless, they are open to sharing the role of primary earner. About 51 percent would like to be the main breadwinner, while 49 percent are fine with a partner taking that role.

Moreover, women are increasingly focused on managing their time. A notable 61 percent would rather earn ten percent less income for ten percent more free time than sacrifice their time for a higher paycheck. Even more, 74 percent would choose a lower-paying, low-stress job over a high-stress position that offers more money.

Working Women and Their Sacrifices

While valuing their time, many working women are willing to make short-term sacrifices to enhance their financial futures. For instance, 70 percent of working women would prioritize maximizing their annual 401(k) contributions over allocating $20,500 for immediate goals. Their focus is clearly on long-term benefits. Additionally, 80 percent would rather fully fund their annual IRA contributions than spend on a $6,000 luxury item.

In general, the primary trade-off working women acknowledge to support retirement savings is reducing spending on luxury items (79 percent). Millennials are particularly inclined to make additional sacrifices, being more likely than Gen Xers and Baby Boomers to limit subscriptions (61 percent) and make compromises regarding housing (48 percent).

Most working women express a preference to defer Social Security benefits to enhance their future payouts (85 percent) rather than claim them immediately (15 percent).

“Our findings reveal that many women, especially as they grow older, prefer a portfolio that ensures reliable retirement income,” states a representative from the Alliance for Lifetime Income. “A significant 83 percent of working women favor a portfolio that provides dependable retirement income over a more volatile option with higher potential returns—this sentiment rises to 88 percent among Baby Boomers. Women consistently emphasize the importance of saving and derive comfort knowing they have secured enough protected income for retirement.”