In this day and age, steps toward
gender financial equality have brought us a long way, but there are
still some marked differences when it comes to women and investing
compared to their male counterparts. Cultural expectations, societal
norms, and a lack of information keep many women from making the kinds
of financial decisions that would bring about the greatest success in
the long run. Fortunately, with the help of the Internet, this education
and information is more readily available than ever before, and women
can take the reins when it comes to their financial futures.
Women Have Unique Needs
Women often have a different set of needs and goals than their
male counterparts, including when it comes to finances. On average,
compared to men, women live longer, spend less time in the workforce due
to caring for children or elderly parents, and earn less over the
course of their lives.
So, when you make less money but live
longer, you have to make different kinds of financial decisions and
preparations. For this reason, women typically retire later than men;
and for this reason, women need to take their needs into consideration
when planning for retirement.
Tip 1: Start Now
In
order to prepare for living many years after retirement, it is prudent
for women to start planning and investing as early as possible. While it
may feel like a sacrifice, being young and taking care of a family,
that monthly sum that you set aside will make all the difference in your
later years. The earlier you begin, the more your money can work for
you, and even small amounts can do great things over the course of many
decades. Don’t wait until retirement looms near to get your ducks in a
row.
Tip 2: Be Honest and Realistic
Whether you are
single or attached, you need to have some frank discussions with
yourself, with the important people in your life, and with your
financial advisor. Think of ways life could potentially play out, even
the scenarios that are uncomfortable or sad. What if you never get
married? What if your significant other goes first? What if you go
first? What if you end up caring for children or elderly parents much
longer than originally anticipated? Make contingency plans for tough
situations. Being prepared for the worst case scenario will enable you
to financially survive it if it does occur, and it will leave you in a
great position if the worst never comes to pass.
Tip 3: Make Sure Key Assets Are in Your Name
For
many married women, it is easy to let significant others take care of
the finances. Not only does this leave you ignorant (and possibly stuck
if tragedy should strike your husband), but it doesn’t always serve your
best interest. Make sure your retirement accounts (such as your 401(k))
are in your name and are set up to sync with your own retirement date
and life expectancy. This will both enable them to work hardest for you
and ensure that you are taken care of in that stage of life.
Tip 4: Make It Personal
Finally,
investing doesn’t have to be cold or impersonal. Invest in something
you are passionate about! Explore different types of investments,
including stocks, mutual funds, investing in businesses and other women,
real estate and land, foreign currency, gold, and the many other
options that are available to you. Women and investing
can be a powerful combination, and by taking care of yourself and your
financial future, you will be in a better position to care for the
people and passions you love.
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