When it comes to planning for retirement, there is no one-size-fits-all option. While the retirement goal of being able to live comfortably during your golden years may be the same for men and women, the path to reach that goal can be very different. There are many issues that women need to account for; that typically don’t apply to men. We are going to identify some of those issues in this article and break down the key planning elements that women need to consider to effectively work toward a more confident, secure future.
One of the first places to start is recognizing that many Financial Planners need to do a better job understanding the necessity for individualized (versus cookie cutter) retirement planning advice and guidance, especially for women. There are several concerns that women must deal with and account for that may be unique to their personal retirement planning situation.
Issues Women Face
Women tend to outlive men
Living longer is a good thing, but it also means that a woman’s money needs to last longer. According to the Social Security Administration, the average American woman lives until age 86.6, while the average life expectancy for men is 84.3. The data goes on to show that about one out of every four 65-year-olds will live past age 90, and one out of 10 will live past age 95.
Many women lack time to plan as they may be juggling many things already
As a woman, you wear many hats: wife, mother, caregiver to an elderly parent or grandparent, you are a working professional with a full-time job, you volunteer at church, or within the community, you are active with the school PTA, all while running kids to and from sports and after-school activities, keeping up with the laundry and putting a hot dinner on the table. Does this sound familiar to you? Maybe some of this describes your life, or maybe all of it describes your life. You don’t have time to take on one more thing on your plate right now.
The risk of needing some form of Long-Term Health Care
Because the life expectancy is longer for women than men, the chances of needing long-term care are much more of an issue for women than men—and needing this long-term care means figuring out a way to pay for long-term care, should the need arise.
Fewer working years
It is no secret that there is a gender wage gap when it comes to actual income between men and women. While this trend seems to be narrowing, there is still a disparity, in part, because it is more likely that women have experienced interruptions in their careers to devote time to raising their families. While this time off to care for family is not viewed as a negative, it does leave gaps in work history, which has a tendency to postpone promotions and raises for women until they have re-established their careers.
Women tend to be too conservative when it comes to investing
A BlackRock Investor Pulse survey shows that women are more risk-averse when it comes to investing. While this propensity can save women from taking unnecessary risks and avoiding short-term losses, it also has the effect of creating less wealth for the long term.
- Stop and take the time to think about your retirement and ask yourself these two questions:
- What do you want your retirement years to look like?
- What type of income does that lifestyle require?
- Consult with a Financial Planner specializing in retirement income planning. Your future and financial security are too important not to take the time to put a solid plan in place. A great place to start is a pre-retirement analysisof where you’re at currently, what gaps may exist, and clear, actionable advice on how to address them based on your individual needs and circumstances.
These first two steps are just the starting point. From there, you need to continuously monitor and adjust your strategies as necessary to ensure they are properly aligned towards achieving, and then maintaining your preferred retirement lifestyle.
Katie Moore, a Financial Planner with Finivi, is passionate about empowering savvy independent women, and women in transition due to a divorce, the death of a spouse, a career change, or other significant life event to expand their knowledge and build their confidence regarding money and investing. Do you need help with your retirement planning? You can call (800)530-6635 or click here to schedule a complimentary consultation.
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