Planning for the Future

By Nicole Middendorf, Prosperwell Financial

I want to share with you a very scary statistic. According to a recent study commissioned by the Transamerica Center, only 8 percent of working American women believe that they’re committing enough to their retirement savings. Nearly one third of the women surveyed claim to “never” talk about the subject around friends and family. Are some of us scared or embarrassed?

I think it’s a combination of three things: fear, ignorance and laziness. Ouch, right? Some of us assume our partners will take care of retirement, while others are finding it hard to put away ANY money towards retirement. With most of America living paycheck to paycheck, retirement is all-too-often an afterthought in the financial planning process.

The prospect of trying to save money in a time of economic turmoil isn’t at the forefront of women’s minds. Every dollar counts in the current market, so it’s understandable why women begin to shy away from saving, let alone saving for their retirement. They have car payments, student loans, rent, mortgages, school fees, insurance payments and monthly bills. Two-thirds of women are working jobs that pay less than $30,000 per year. Almost half of that same two thirds work those jobs without 401(k) or other retirement plans. How are they supposed to protect themselves moving forward when they’re just trying to get through today?

As a society, we work throughout our lives with the purpose and intention of providing for ourselves and our loved ones. We put in our time trying to earn the privilege of receiving the chance to walk away from the workplace on our terms. These terms generally mean certain sacrifices will be made during the length of a career. Every vacation or car that was attainable was instead pushed aside for another luxury. Although it manifests itself differently for everyone, retirement represents the reward for responsibility. It truly affords one the life they would prefer to lead outside of work. For men and women, retirement means different things.

Men want to be financially comfortable when they eventually step away from a career. Fiscal confidence means a great deal to women, but they focus on the things money can’t buy instead.

Associated expenses might simply be the costs of pursing the activities you love or the expenses of fulfilling your dreams. They also may have to deal with the uncertainty of outliving a spouse or partner and facing the world alone. Women, on average, live longer than men, meaning their resources will have to outlast a man’s too. Some women will be lucky enough to inherit some of their deceased husband’s savings. The truth is, the world is changing and we ALL need to focus on saving, growing and keeping our assets, no matter our marital status.

In the financial process, each one of us needs help in attaining new levels of understanding. Although I consider myself an expert on retirement, savings and investments, I am constantly learning about human behavior and how I can best help my clients. Discussing monetary goals, fears and shortcomings can give women a better foothold on their ability to make the best decisions. Those decisions will lead to greater confidence, and greater confidence means happier women!

Fifty-seven percent of American women aged 65 or older are single. These women are saddled with making difficult decisions by themselves, which is a harrowing prospect for anyone who is ill-informed. Over the years, the level of Social Security protection for women has been strengthened, but we are unaware of what might happen with the program.

As Social Security becomes an even more volatile issue in the U.S., we should be aware that nearly 60 percent of those receiving Social Security are women. Many of the Baby Boomers who have retired or are set to retire have long-planned on using the funds provided from Social Security as their main source of income, which is a terrible idea. Social Security is a tax, plain and simple. It’s not meant to be retirement savings and surely, it’s not meant to be counted on.

Save your funds in a 401(k) or IRA. It’s never too late. As the Social Security system has become compromised and drained, the amount of money citizens contributed may not match the expected payout they anticipate. This leaves many women sadly stuck. While the government and powers that be are currently grappling over what’s next for Social Security, generations still working should see this issue as greater incentive to think about their retirement.

Securities offered through LPL Financial. Member FINRA/SIPC 

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