Women Versus Men Saving in 401(k) Plans

Are women better savers with their 401(k) accounts than men? Research conducted by the Vanguard Group1 sheds some light on this question and a few others related to women versus men when it comes to saving for retirement.

At first glance, it appears that men are better savers since their average and median 401(k) account balances are more than 50% larger than those of women. However, when you adjust for the income of each group, the study found that women are the better savers.

The following is a breakdown of the study’s findings.

Account balances: Him versus her

Although the study found that women are more likely to save in workplace plans, men have bigger account balances largely due to higher wages. The average account balance of the male study participants was $118,131, while the average account balance for women was $78,437. The median account balance for men was $33,573, versus $19,823 for women.

An interesting insight was that as income levels between men and women converge, so do their average account balances. In other words, while their income levels tend to be different, their saving habits are more similar than they may appear.

Investing styles: She versus he

Despite the common belief that women are less likely to take investment risks than men, the Vanguard study revealed that both groups invest similarly when it comes to the percentage of stock exposure in their defined contribution accounts. Average equity allocations are 75% for women and just one point higher for men.

However, there is a difference in the way men and women invest in equities.

Women are more likely to invest in target-date funds, with 64% of their portfolios invested in target-date funds compared to 57% for men. Target-date funds can simplify investing for retirement because they provide a diversified mix of stocks and bonds that automatically rebalances over time. This is a hands-off approach that ensures that the closer an investor gets to retirement, the more conservative their mix of assets becomes.

Women in the study were also more likely to invest in index funds than men. Seventy-two percent of the equity exposure is in index funds for women and 68% for men. Index funds are also a hands-off strategy that passively invests in a broad collection of funds that track market indexes such as the S&P 500, Dow Jones and NASDAQ.

Bottom line: Men versus women

The Vanguard data suggest that women and men do have some differences when it comes to their retirement plan savings.

Women are more likely to participate in 401(k) plans, and when they do take part, they save more on average. Women are also more likely to use professionally managed or passive investments than men, although, on average, men and women take similar levels of equity risk and hold similar types of portfolios.

And finally, men have higher wealth accumulation than women, not as much because of their savings habits or investment styles as due to their higher wages.

Vanguard drew this research data from workplace plans that use its services for recordkeeping. The average worker age was 43, and the average tenure was nine years for women and 10 years for men.


Source: Young, Galina and Young, Jean A. “Women versus men in DC plans.” Vanguard, January 2019. https://institutional.vanguard.com/VGApp/iip/site/institutional/researchcommentary/article/InvResWomenVsM


Erik Nelson

Erik Nelson

Financial Planning Director

Erik joined legacy firm Dowling & Yahnke in 2019 as a Financial Planner and now is the firm's Director of Financial Planning. He manages the financial planning team and serves as a technical leader for complex planning issues and initiatives. Prior to joining Dowling & Yahnke, he served in financial planning and advisory roles over the last five years with two local investment management firms in San Diego.


Erik holds a CERTIFIED FINANCIAL PLANNER™ designation and Certified Private Wealth Advisor® (CPWA®) certification. He has a Master of Science in Business Administration (MsBA) in Financial & Tax Planning from San Diego State University. Erik completed his undergraduate work in Business Administration and Finance at San Diego State University.


Erik is a native San Diegan who currently resides in La Jolla and is an avid sports fan.


This information is for educational purposes and is not intended to provide, and should not be relied upon for, accounting, legal, tax, insurance, or investment advice.  This does not constitute an offer to provide any services, nor a solicitation to purchase securities. The contents are not intended to be advice tailored to any particular person or situation. We believe the information provided is accurate and reliable, but do not warrant it as to completeness or accuracy.  This information may include opinions or forecasts, including investment strategies and economic and market conditions; however, there is no guarantee that such opinions or forecasts will prove to be correct, and they also may change without notice.  We encourage you to speak with a qualified professional regarding your scenario and the then-current applicable laws and rules.

Advisory services are offered through Corient Private Wealth LLC and its affiliates, each being a registered investment adviser (“RIA”) regulated by the U.S. Securities and Exchange Commission (“SEC”).  The advisory services are only offered in jurisdictions where the RIA is appropriately registered.  The use of the term “registered” does not imply any particular level of skill or training and does not imply any approval by the SEC. For a complete discussion of the scope of advisory services offered, fees, and other disclosures, please review the RIA’s Disclosure Brochure (Form ADV Part 2A) and Form CRS, available upon request from the RIA and online at https://adviserinfo.sec.gov/. We also encourage you to review the RIA’s Privacy Policy and Code of Ethics, which are available upon request.

Our clients must, in writing, advise us of personal, financial, or investment objective changes and any restrictions desired on our services so that we may re-evaluate any previous recommendations and adjust our advisory services as needed. For current clients, please advise us immediately if you are not receiving monthly account statements from your custodian. We encourage you to compare your custodial statements to any information we provide to you.