In 2004, the average age of RNs in the United States was 46.8 years, and only 5.7% of them were men1-therefore about 94% were women. Important points about women and retirement, then, are especially compelling for nurses. Consider the following.

* Despite having made great strides in earning capacity, women still earn only about 80% of what men do.2 Therefore, women have less money to invest in their retirement.

* Because women are more likely than men to take time away from their careers to care for children or aging parents, they spend an average of 11.5 years out of the workforce.3 Many nurses work part-time or per diem, which may also have a negative effect on lifelong earning capacity and, consequently, on retirement savings.

* Women's average retirement income is $6,020; the average for men is $10,450.4

* Women, who live an average of seven years longer than men, are "more likely to outlive their [financial] assets."4 Current estimates predict that more than 1 million people who are in their 40s today will live to be 100 or older.5 Nurses can attest to this trend as they care for an increasingly older population.

HOW TO GET STARTED

If you aren't already planning for retirement, start immediately. Begin by listing your assets: savings, investments, real estate, and total income. Next calculate your expenditures: rent or mortgage, utilities, car payments, taxes, student loans, credit card balances, and other living expenses. Identify expenses you can possibly reduce. Then, start saving. Enroll in the retirement plan your employer offers. Almost every health care employer offers either a 403(b) (for nonprofit organizations) or a 401(k) (for for-profit organizations). Most employers also will match the amount you contribute. Never pass up an opportunity to participate in one of these plans. If your employer doesn't offer one, you or a financial advisor can set up an Individual Retirement Account (IRA). The money you contribute will be invested in the stock market, and the value of your account will vary as the market fluctuates. Left untouched for years, however, this account will likely yield a significant amount of money, leaving you with an ample nest egg for your retirement.

HOW MUCH TO CONTRIBUTE

The ideal amount to contribute to your retirement investment is 10% of your pre-tax income.5 Most financial experts recommend "paying yourself first"-that is, setting aside from every paycheck some money for retirement. The easiest way to do this is through payroll deductions, if your plan allows it. Payroll deductions also reduce your taxable income, so you'll pay less in taxes.

There are other advantages to investing in retirement plans, whether they are employer-sponsored or personal IRAs. By having investment assets, you may more easily qualify for a mortgage; first-time home buyers can withdraw up to $10,000 from their plans without a penalty.5 You also can take penalty-free withdrawals to pay medical expenses and college tuition.

Most facilities that offer retirement plans work with financial advisors who can help you choose the types of funds to invest in and how much to allocate into each. Funds vary from aggressive stocks to more conservative mutual funds. Financial planners will help you determine the type of investments you need. For example, a single 20-year-old will have a different investment plan than a married 40-year-old who is putting several children through college. But the types of funds you invest in are not as critical as getting into a fund and saving as soon, and as much, as you can.

You'll need 70% to 80% of your income before retirement to maintain your style of living after retirement.5 Looking at which expenses increase or decrease can also help you plan. For example, job-related costs, such as commuting and buying new work clothes, will go down, and you may have paid off your mortgage and written your last college tuition check. Some other things to plan for include the following:

* Taxes usually go up, not down.

* If you are at home most of the time, your utility bills may increase.

* Homeowner's and car insurance costs may increase.

* Medical expenses, especially prescription drugs, usually increase.

One critical expense that you must always budget for is health insurance; very few employers today offer health coverage for retired employees. Nurses know the value of high-quality health care, but it comes at a cost. Keep in mind that Medicare coverage begins at age 65 and covers inpatient hospital, skilled nursing facility, home health, and hospice care at no cost. Coverage for portions of other expenses-physician fees, prescription drugs, and outpatient services-is available for a fee.

In addition to retirement plans, take advantage of long-term care insurance if your employer offers it. Assisted living or skilled care is extremely expensive-currently an average of $4,000 a month for assisted living care and more than $5,000 a month for skilled care. Few people can afford to pay those costs for very long; considering an increased life expectancy, this is a crucial consideration. But with sensible and early planning you can afford and enjoy your retirement.

Resources for Retirement Planning

AARP

http://www.aarp.org

Women's Institute for a Secure Retirement

http://www.wiser.heinz.org

Older Women's League

http://www.owl-national.org

REFERENCES