HECMS CAN IMPROVE WOMEN'S FINANCIAL SECURIT Y IN RETIREMENT
H ECMS CAN IM PROVE WOM E N’ S FINANCIAL SECURIT Y IN RETIRE M E NT The significant financial security disparity between women and men is well known. Despite pursuing higher education in greater numbers and working more hours, women earn only 82 cents on the dollar compared to men, with women of color earning even less on average. The contrast between women’s and men’s lifetime earnings is even more stark, with bachelor’s degree holding . 30
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BY W E N DY PE E L
Even for women who have shattered the glass ceiling, the reasons for gender wage disparity are all too familiar. Women perform unpaid and uncounted work, such as childcare and household management, in outsized numbers. According to Morningstar’s 2020 report on women and investing, women are more likely to sacrifice career and earnings to care for an elderly relative, with adult daughters twice as likely to act as informal longterm caregivers to parents than adult sons. Despite the attention given to the gender wage gap, little ink is dedicated to the sobering reality that reduced earnings imply women are at greater risk of not achieving financial security in retirement. Because they earn less and must make their money last longer (U.S. women outlive men by five years on average), women tend to be in worse shape than men on nearly every important retirement metric. The point in articulating gender wage disparity is to drive home that retirement readiness is a women’s issue, and that, as mortgage lenders, we are uniquely positioned to match women with home lending programs that help them attain their financial goals as they age.
ENTER THE HECM
In particular, the Home Equity Conversion Mortgage (HECM) is an FHA-insured loan program designed specifically to meet the needs of aging homeowners and can offer substantive benefits to
