Financially speaking, women are headed in the right direction. But women often face special challenges when planning for retirement.
As we enter Women’s History Month, it’s important to take a moment to reflect on the contributions that women have made to society throughout history.
One area where women have often been overlooked is in the field of finance and retirement planning. With women living longer and earning less than men on average, financial and retirement planning is crucial for all women.
During this Women’s History Month, we acknowledge the work that still needs to be done to ensure that women can enjoy a secure and comfortable retirement. Whether you are a retiree or are just starting to think about your retirement planning, this blog is for you.
Why Women Need a Financial Plan
Financial planning is critical for women for several reasons. First and foremost, women generally earn less than men, which can make it more challenging to build long-term wealth. Additionally, women often take time off work to care for children or aging parents, which can have a significant impact on their income and retirement savings.
Furthermore, women tend to live longer than men, meaning they need to save more for retirement. Although saving for retirement is a challenge for many Americans, women encounter even greater obstacles due to the gender pay gap. This ultimately results in a retirement wealth gap. This gap in retirement income between older women and men is significant, with women receiving approximately 80% of what men receive.
This is why it’s essential to take control of your finances to secure a stable financial future.
Creating a Financial Plan
One of the ways you can prepare yourself is to create a healthy financial plan. Here are some steps to consider:
- Evaluate your current financial situation: Begin by analyzing your income, expenses, and debt to gain a clear understanding of your current financial state. This will help you identify areas that require adjustments.
- Establish financial goals: Identify both short-term and long-term financial goals, such as paying off debt, purchasing a home, or saving for retirement.
- Create a budget: Develop a budget that includes your income, expenses, and financial objectives. Ensure that you allocate sufficient funds towards your goals and reduce non-essential expenditures.
- Build an emergency fund: Set aside a portion of your income to cover unforeseen expenses like medical bills or home repairs. Aiming to save at least three to six months’ worth of living expenses is recommended.
- Start saving for retirement: Open a retirement account, such as an IRA or 401(k), and start contributing as much as you can afford. If your employer offers a 401(k) match, be sure to take advantage of it.
- Invest wisely: Consider investing in low-cost index funds or exchange-traded funds (ETFs) to help grow your wealth over time. Be sure to consult a financial advisor to help determine the best investment strategy for you.
Following Your Financial Plan
Making a financial plan is just the first step towards financial security in retirement. The real challenge is to stick to your plan and make adjustments along the way. Here are some tips to help you stay on track:
- Review your plan regularly: Check in on your progress towards your financial goals regularly and make adjustments as needed.
- Automate your savings: Set up automatic transfers from your checking account to your savings or investment accounts to ensure you stay on track.
- Avoid impulsive purchases: Stick to your budget and avoid making impulsive purchases that can derail your progress.
- Get support: Consider working with a financial advisor for support and guidance.
Getting the Help You Need
Even if you’re staying at home to care for family, you can — and should try to — save for retirement. Retirement planning takes into account not only assets and income but also future expenses, liabilities, and life expectancy.
Despite greater concern over their ability, women are more likely to manage their savings on their own and less likely to leverage educational and advice resources. The appetite for education and advice, however, is stronger for women than men.
By empowering yourself with financial knowledge, you’ll be able to further take control of your finances and help set yourself up for retirement success.
If you are looking for professional guidance with your financial strategy, retirement income planners aren’t just for the financially savvy or those with huge amounts to invest. In fact, the right retirement income planners can offer the greatest help when you’re less sure about where to start. They will:
- Work with you to create a custom and detailed retirement plan that incorporates and addresses your very specific goals and unique retirement needs.
- Introduce effective investing guidance and portfolio management.
- Act as your savings coach, helping you understand and track your progress.
- Work with you to adjust your plan as life changes.
- Consider how your retirement plan fits into your overall financial situation.
- Make sure you stay connected and engaged with your plan.
A financial and retirement plan is crucial for women who want to achieve their long-term financial goals. But whether you’re married, single or widowed, navigating the financial vortex of retirement planning needn’t overwhelm you.
By following these steps, you can help build wealth, reduce financial stress, and secure a brighter financial future.
Join us as we celebrate Women’s History Month and explore the benefits of financial planning with CKS Summit Group. Set up your complimentary strategy session with us here today.
Happy International Women’s History Month from the entire team at CKS Summit Group.