Why annuities are a powerful retirement strategy for single women

Women are not staying on the sidelines when it comes to their retirement planning, and being single is more common for women than ever¹. That shift is helping reshape retirement planning. 

Women are involved and proactive in seeking out new ways to ensure they’re ready for life after work and evaluating the impact of investments or career choices on their long-term financial planning. In many cases doing it independently can be both an opportunity and a challenge.

Nearly three in 10 women ages 50–64 report being single¹. Among women 65 and older, that number rises to 49%, compared with just 21% of men¹. And the trend is growing. As of 2021, roughly 25% of 40-year-old women in the U.S. have never been married — a major jump from previous trends measured in 1980².

This independence shapes a unique path to retirement planning. Considering just one income stream, Social Security benefit and primary savings plan makes early and proactive planning essential. For single women, setting priorities may need to go beyond just wealth building. For one, aging without a partner to assist with daily needs or healthcare can increase the costs and create a greater need for long-term care planning. Women generally live longer, which extends the time needed for care and increases expenses. Preparing for your future health needs should have a prominent place in a strong financial strategy. 

But planning alone also offers women more clarity and control. You can set your own goals, fund your own priorities and make decisions that support the lifestyle you want.

To build a retirement plan that stands strong for decades, flexible and reliable income sources are vital. Think about what can help offset a major expense like long-term care. This is where annuities may play a strategic role, working alongside savings and investments to create dependable income that can last longer.

The unique retirement landscape for single women

Retirement planning looks different for everyone. But if you’re saving on your own, consider some of these financial realities. 

Lifetime earnings and savings gaps are harder to offset alone. Women may already be considering their longer lifespan, living an average of five to six years longer than men³. Combined with the persistent gender pay gap, women earn about 82 cents on the dollar compared with men⁴. These situations could reduce retirement savings and Social Security benefits without a partner’s income to fill some of the gap. 

Income needs to go further: 

When it comes to budgeting, costs for housing, car payments and more, are covered solo. While dual-income households may benefit from shared expenses, single women often need to cover expenses on one income, making careful planning essential. 

Taxes may not come with unique benefits: 

Married couples may benefit from certain tax advantages and impact savings plans. Single women may want to consider how their tax bracket, Social Security benefits and withdrawal strategies affect after-tax retirement income. 

Healthcare planning is solely your responsibility: 

Couples may be able to share employer-sponsored coverage or coordinate healthcare costs. Single women must plan independently for healthcare expenses and potential long-term care needs.

Managing finances solo requires discipline, but it also provides autonomy. You can choose strategies and tools, such as annuities, that align with your goals, risk tolerance and need for predictable lifetime income.

For women who are divorced or widowed, other financial factors could impact their planning. Social Security benefits based on an ex-spouse’s contributions (and depending on length of marriage), income projections when splitting assets after a divorce or receiving survivor benefits, and life insurance payouts can change retirement income math. Plus, updating beneficiaries, reviewing existing annuities, and changing long-term care plans can come into play.

Understanding annuities

As you build a retirement strategy that must rely on one income and last across a longer lifespan, predictable income streams become extremely important. An annuity is an insurance product designed in part to convert savings into guaranteed income, often for life. You contribute money, either in a lump sum or over time, and in return, you may receive regular payments you can rely on based on the terms of your annuity contract.

There are several types of annuities , so you can explore options that may align with your goals and income needs. 

Annuities are different from 401(k)s, IRAs, or traditional investments in that they can produce guaranteed income. This makes them a complement to Social Security, pensions, retirement accounts and other savings tools that can make up a diversified plan. Annuities can provide meaningful growth — along with protection and the option for guaranteed lifetime income.

Annuities have a strategic place in women’s financial planning

Healthy financial goals like stability, longevity protection and control align with the benefits of annuities. They provide guaranteed income, which can be crucial for maintaining independence — especially considering women’s longer life expectancy increases the risk of outliving their savings.

Regardless of market swings, the predictability of the income can help bring peace of mind, especially when managing finances on your own. 

Annuities can help fill income gaps between Social Security, savings and investment withdrawals, complementing your other retirement assets. This can help reduce the pressure on other accounts and supports a more balanced long-term strategy.

Choosing the annuity that works for you

Annuities aren’t one-size-fits-all. The right choice depends on your timeline, financial picture and retirement goals.

Key considerations include:

• Your age and retirement horizon
• Health and longevity expectations
• Risk tolerance and need for predictable income
• Preferences around inflation protection, payout flexibility and interest features

Working with a trusted financial professional can help you sort through options, compare benefits, and design a plan tailored to your needs.

See your financial plan in action

To understand how this may look, here’s an example of a woman making it work for her. Meet Laura: 56 years old, single and enjoying her career and life.

Take charge of your financial future

Having the right information and support are critical when facing retirement savings challenges and taking advantage of the strengths and opportunities you already have.

Annuities can help create reliable, long-lasting income and reduce financial stress that come along with being on your own. Best of all, rather than being restrictive, this planning can be truly empowering for single women.

Talk with a financial professional to explore how annuities and other income strategies can help you achieve lifelong financial independence.

Want the most from your retirement? Get smarter with Smart Strategies from Athene. Your source for tips, tools and financial solutions that can help you live your best life.

¹ Pew Research, 2020, A profile of single Americans. 

² Pew Research Record high share of 40-year-olds have never married

³ CDC, 2023, Life expectancy at birth. 

⁴ Pew Research, 2023, The enduring grip of the gender pay gap. 

Any information regarding taxation contained herein is based on our understanding of current tax law, which is subject to change and differing interpretations. This information should not be relied on as tax, legal or financial advice and cannot be used by any taxpayer for the purposes of avoiding penalties under the Internal Revenue Code. We recommend that taxpayers consult with their tax or legal professionals for applicability to their personal circumstances.