The latest research conducted by the Investors Observer research team has revealed that American women accumulate at least $1 million less than men over a typical 40-year career, assuming the same average retirement contributions are invested in an S&P 500 Index fund. 

Key findings:

• Over a typical 40-year career, the average male worker in the US accumulates $2.73 million in portfolio wealth, assuming average retirement contributions are invested in an S&P 500 Index fund.
• By comparison, an average female worker investing her savings under the same conditions accumulates $1.75 million in portfolio wealth, resulting in a $1 million gap.
• This compounding effect means that even small annual differences in contributions lead to vastly different wealth outcomes by retirement.
• While the wage gap between men and women has narrowed, by 2023 women earned 83% of what men earned on average.
• The wage gap and resulting investment gap persist despite women’s increasing presence in higher-paying industries.

This research offers a fresh perspective on the wage gap debate, showing that its impact goes far beyond a single paycheck – it shapes lifelong financial security. Even small annual differences in income translate into significantly lower investment growth.

The researchers analyzed 40 years of earnings and retirement contributions data (1983–2023) for full-time workers in the U.S.

Source: Investors Observer, a news site covering financial investing and related subjects.