It is a harsh truth that many women either leave money matters to the men in their lives or ignore the importance of financial planning altogether. Couple this with the fact that women face different challenges and financial risks than men, and it becomes clear why women must take charge of planning their financial futures.

Women worry with good reason: they outlive men. According to the National Center for Women and Retirement Research, at age 60, a man has a life expectancy of 19 years, but a woman has a life expectancy of 24 years.

Those 5 extra years of life will be expensive, and they will come when you may have the least ability to make good decisions. In addition, as many as 9 out of 10 women will be solely responsible for their finances at some point in their lives. Here are some statistics that we should be aware of:

• Over 75% of women are widowed at an average age of 56, and 1 in 4 of these women are broke within 2 months of being widowed

• Less than 15% of women who are married feel responsible for planning their retirement.

• 87% of poverty-stricken elderly Americans are women.

Knowing how to handle your finances is a necessity
Women need to be educated and prepared. Understanding your finances now can help prevent money crises later. We are called by scripture to “get understanding, and get knowledge” (Proverbs 4:7). Read an investment book, take a class, go to an investment club, or ask other competent women how they got their knowledge and acumen.

Unfortunately, there are a number of barriers that women face to financial security that must be overcome:

1. Two out of three working women earn less than $30,000 per year, and 9 out of 10 earn less than $50,000.

2. Half of all women work in traditionally female, relatively low paid jobs without benefits or pensions.

3. Women retirees receive only half the average pension benefits men do.

4. Women’s earnings average $0.76 for every $1 earned by men – a lifetime loss of over $300,000 (Barriers sourced from: Women’s Institute for a Secure Retirement 2011).

Get involved in your family’s finances
As a couple, spend time every week discussing the family finances and make it a routine. Understand and record what is going on with your investments, banking and budgeting. Discuss and write down your financial goals. Most people find it difficult to save or invest without specific reasons and goals.

Even though men traditionally like to control the finances, here is an astounding fact: over the next decade, women will have control of two-thirds of consumer wealth in the United States and be beneficiaries of the largest transference of wealth in our country’s history – an estimated $12 to $41 trillion (she-conomy.com). Women will experience a double-inheritance windfall, receiving wealth from both their parents and their husbands. In light of this, it is all the more important for you to get knowledge and understanding, and get it now.

Plan your financial life as if you will be on your own someday
Manage your finances together, but make sure that your name appears on all investment accounts and bank accounts. Be sure to have your own retirement account. Even if you are a stay-at-home mother you can have the family budget contribute to your retirement.

Women need to be even more diligent and effective when it comes to financial management and retirement planning. A recent Transamerica Center for Retirement study found that the majority of women are not confident in their ability to retire at their current lifestyle. 55% of respondents said they have no retirement strategy at all, and a “lack of knowledge of investing and retirement fundamentals” was cited in the report as underscoring the need for improved guidance and education. “The findings are alarming”, the study states, “Unfortunately, this trend will likely continue unless women make some profound changes and take charge of their own financial futures.”

Get good advice
If you are married, ask your husband to share the planning he is doing with you. Be persistent to get terms. Many times the woman is the one overseeing the finances and budget for the family. If this is the case for you, it is even more important to get understanding and apply yourself to good stewardship.

Get professional advice before you become suddenly single. This will make your financial road smoother and will prepare you prior to difficult and overwhelming life events. A good financial advisor will educate both spouses of the overall plan, helping a woman to have understanding and ownership along the way. A good planner will have the heart of an educator; if yours doesn’t, keep searching for one that does.

Above all, don’t worry
We are called to be faithful, not successful; you can only do the best you can do. Don’t worry, but do take initiative, work hard and be industrious about acquiring knowledge and understanding. No matter what age you are, there is great benefit to developing a financial plan. Learning about finances doesn’t have to be difficult or complex, but it is critical to your stewardship to seek out understanding.

Jeffery Masters, President of Jeffery W. Masters & Associates
Securities offered through LPL Financial, member FINRA/SIPC
Investment Advice offered through Independent Financial Partners,
a Registered Investment Advisor. Independent Financial Partners and Jeffery W. Masters
& Associates are not affiliated with LPL Financial.
Jeff is a Locally Endorsed Investment Advisor by Dave Ramsey.
Questions? Call 954-977-5150, visit JeffMasters.com or email [email protected].