Women have every right to the same financial future as men.
Yet, for a number of reasons, most advice on financial planning leaves out the female perspective.
Of course, many elements of financial planning are gender neutral: the value of the dollar, the direction the market moves, the performance of a 401(k), etc.
That being said, women face economic and lifestyle issues that are different than men and this often affects their ability to invest. The following should help women feel better able to take control of their personal finances and financial futures.
Women Are Often Unprepared to Take Over Financial Planning
Every woman must understand her own personal finances and what it takes to manage them. Although times are changing, this is something men have almost always taken for granted, though many women still don’t.
As Loretta Hutchinson points out, as a woman, at some point in your life, there’s a very good chance you will be responsible for your finances.
“Women live, on average, five years longer than men, and the average age of widowhood, according to the U.S. Census Bureau, is 59. Add to this that a marriage has only a 50-50 chance of being successful. Because of these factors, you owe it to yourself to learn as much about saving and investing your money as you can.”
If you and your significant other agree that they will be the one to handle financial planning in your relationship, that’s fine. However, even if you’re relying on an advisor to help, that’s no excuse not to understand your personal finances.
For one thing, two heads are always better than one. For another, sadly, circumstances may someday dictate that you’re solely in charge of making decisions about your financial future.
Many Women Have Been Left Behind
In an earlier post, we talked about the importance of women becoming confident with their finances:
“Five years into the financial recovery, Prudential’s 2014-2015 Research Study, ‘Financial Experience & Behaviors Among Women,’ reveals that while women are taking control of household finances, they are no more prepared to meet long-term financial goals than they were a decade ago. In fact, while 75 percent of women believe that it is important to have enough money to maintain an enjoyable lifestyle in retirement, only 14 percent are very confident they will be able to actually achieve this goal.”
This represents a confidence gap of -61 – no small amount – and shows that men are currently more fluent when it comes to financial planning. This, despite the fact that the same study reported that 44% of women – almost half – are the primary breadwinners and 27% of them said they are the ones in control of their family’s finances and planning for retirement.
To put this into perspective, back in 2006, only 14% of women said this. In just 8 years, the number nearly doubled, yet women are still trying to play catch-up when it comes to learning about financial planning.
For whatever reason, males have had a head start, which is something women must realize before jumping feet first into trying to figure out an appropriate financial path for their needs.
In most cases, it would seem they should spend some time educating themselves. To be fair, in our experience, this is something both sexes would benefit from doing.
Traditionally, Financial Planning Has Been Male-Dominated
The easiest explanation for why financial planning for women is burdened with these gaps is because, traditionally, this was something that only men did.
Again, we’ve come a long way, but two generations ago, it would have been almost unheard of for a female to be involved in financial planning. For women of just a generation ago, this was still a very new field.
Last year, Stash and Harris Poll teamed up to find out why Millennials are so behind when it comes to investing. One of their key findings was that many young females simply don’t feel like this is supposed to be their area of expertise. Consider:
- 85% of Millennial women don’t invest at all
- 76% of Millennial women find investing confusing
- 60% of Millennial women think of an old, white man as the typical investor
That last statistic may be responsible for the other two and countless more that explain why financial planning for women isn’t on par with that of men – yet.
Let Mooney Lyons Help
The truth is that everyone feels confused about their financial futures. In that Prudential study we mentioned earlier, men and women reported the need for help at almost identical levels (80% for women; 76% for men).
It’s just that there are particular issues that must be taken into consideration where women are concerned.
If you’d like help with financial planning so you can be confident about your future and put your money to work, Mooney Lyons is at your service. Please feel free to contact us today to discuss how we can help.