On average, women have less money when they retire than men do. This isn’t entirely surprising; there is an established trend of men making more money than women, so they can build more savings.
Recent studies suggest that most women will retire with about 1/3 of the amount that the average man retires with. One of the biggest concerns about that estimate is that women live longer then men, so they actually need more money to retire.
- Many women over the age of 75 live alone, so it is especially important that they have enough money to get them through their later years.
- Many women with higher education will earn half a million dollars less during their lifetime than a man with an equivalent education.
- A large percentage of financial advisors are men, and therefore may not be in the best position to understand the unique situation of single or windowed women.
As a woman, it is very important that you begin to take charge of your estate planning as well as your financial planning. You are likely to live longer than your husband (if you have one), and make less money over the course of your life, so a solid estate plan is essential.
If you had an estate plan with a former spouse , you’ll need to update your estate plan to ensure that all of your legal documents are prepared. You may also want to consider more aggressive investment and retirement savings plans. Some of the documents you will need to prepare with an estate planning attorney include durable power of attorney (which is often divided into two documents, medical and financial), a living will and a conventional will.
In addition to the legal aspects of an estate plan, you should also ensure that your finances are in order, including any IRA accounts and insurance policies. Check that your deceased or former spouse is no longer listed as a beneficiary. Find a financial planner that you feel comfortable with and look for ways to strengthen your financial standing.
Financial planning is extremely important for women, especially when it comes to retirement.