Women face more numerous retirement related risks than men.
These include; longer life spans, lower lifetime earnings, less time in the workplace due to care-giving and lower Social Security benefits. A woman’s retirement outlook therefore is at greater risk than a man’s.
It is understandable that short-term priorities may take precedence, however women must keep their financial future in mind. The following steps may help a woman improve her outlook for retirement.
- Assess your current financial situation and create a budget. This is a most basic step, a starting point from which all other actions should follow. If you do not know how you are doing with your cash flow, you will never be able to truly assess where you are and where you are heading. Pay attention to the following: income, living expenses, paying off debt, having an adequate emergency fund as well as long-term savings.
- Develop a retirement strategy and put it to paper. Having a plan “in your mind” is not a plan, it is a wish. Use a qualified retirement planner or use online tools and calculators to estimate your retirement income and long-term savings need. Formulate a savings plan to meet those needs and hold yourself accountable. If you find it hard to do it yourself, seek out professional, experienced and qualified fee-only retirement advisors. A fee-only advisor will charge you for the plan but should not try to sell you something in lieu of the planning fee.
- Avoid taking early withdrawals from your retirement plans. This can wreck your retirement income later in life.
- If faced with caregiving responsibilities, carefully consider the impacts to changes with your employment. Explore options such as shifting to part-time work. Taking care of loved ones is important but review what this will do to your ability to earn an income and save for your retirement. Determine whether others can help you with the care-giving that is needed.
- Be proactive to ensure that you remain viable in today’s work environment. Hone your current work skills, learn new ones, follow work trends and network with others.
- Stay vigilant regarding your finances and investments. Review your bank statements, retirement account statements that you have at work as well as those you have outside of work.
- Learn about strategies for withdrawing your investments during retirement. Accumulating your money for use later in life is one matter, drawing down your money during retirement is another. Not knowing how and when to use your money to fund your retirement can be very costly. When should you start taking Social Security? Which retirement fund should you take from first? Do you know how much you can take without endangering your financial future?
- Devise a back-up plan. What would happen to you financially if you lost your job, a divorce, death of a partner or an unanticipated drop in your investments?
- Take care of yourself both physically and mentally. Consider health implications when making lifestyle decisions. Are you eating properly? Are you exercising enough?
- Beware of scams. Scams are everywhere and the elderly are the most targeted portion of the population. It may come in the form of a telephone call, an email or through what you think is a legitimate organization that you do business with.
Retirement Solutions has been working with women for decades. We have the expertise to guide you before and during your retirement. We offer a no-obligation, no-cost 15 minute consultation to determine if we can be of assistance.
Simply click the “Schedule a Consultation” link in the upper right corner of this page. You talk, we listen.