March is Women’s History Month, a month-long celebration of female empowerment1. This effort includes advocating for better representation in the workforce, pay parity and improved work-life balance. There are some specific steps that women of all ages and all stages of life may take to manage their financial future. Here are some economic challenges women face and how they overcome them.
Longevity is a good thing—but when it comes to funding retirement, it also means needing more savings than someone who may have a shorter life span.
Determining how much you need for retirement might seem daunting, especially if you still have another decade or more before your expected retirement date. But even if you do not have a certain number in mind, here are strategies to consider:
- Contribute as much to your retirement as possible—especially if you get an employer’s matching contribution.
- Consider investment returns that are appropriate for your age and stage of life. If you are young, you might afford more risk. However, it may be time to manage risk more carefully if you are near retirement.
Above all, do not get discouraged. It is never too late to begin to save or save more. Suppose you are not sure about having enough for retirement. In that case, you may be able to downsize by lowering expenses with a more frugal lifestyle, continuing to work a few extra years before retirement or starting a side business. A financial professional may help create a retirement budget and help you figure out how to work toward your goals.
Creating and maintaining an emergency fund is the only way to break the living from a paycheck-to-paycheck cycle. Without an emergency fund, you may pull out a credit card whenever an unexpected expense arises, such as a vehicle repair, vet bill, or needing to replace an appliance.
By setting aside a few months of living expenses in an accessible account (like a savings or money market account), you might have less stress from knowing that you have some resources to help cover emergencies.
In many marriages, one partner may take the lead in financial matters. This strategy may leave the other partner uninformed. Divorce or death might be more complicated and heartbreaking if the spouse who does not manage the money is surprised by the financial situation.
Make time for money conversations—even uncomfortable ones. Discuss your goals, values, and plans for the future with your life partner. Not only might this help you understand your financial status, but it may also improve communication with your spouse.
Part of adequate retirement savings includes knowing how much you expect to receive in Social Security benefits, whether on your earnings or your spouse’s record. The Social Security Administration offers an online tool that reports your earnings history and projected Social Security benefits.2
It is important to review your earnings record to ensure its accuracy. Should the system understate your earnings, your monthly benefit could be lower than it should be.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Investing involves risks including possible loss of principal.
All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by WriterAccess.
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1 March is Women’s History Month
2 Social Security in Retirement