The Best Gift You Can Give Your Wife This Mother’s Day: A Sound Financial Plan

For Mother’s Day this year let’s think about the best gift for the women in our lives – it’s not flowers or chocolates or a silk scarf – but a sound financial plan.  Women are likely to outlive their spouses but studies show that as few as 35 percent of women are involved in planning for a lengthy and financially healthy retirement.  In honor of Mother’s Day, I want to share the importance of making sure that the women in your life are prepared for retirement.  I recognize that sometimes the financial leaders in the house are women and these points are equally significant for men, single people, widows and divorcees.

Women generally live longer than men, three years more, in fact. Currently, there are six million more women than men ages 65 and over in the United States which means planning for a lengthy and financially healthy retirement that could last 30 years or more, is crucial. Compounding this problem is the fact that women save less than men. Women who continue to work part-time for an employer that offers a retirement plan are less likely to be vested if they are covered and statistically, of the 62 million wage and salaried women (age 21 to 64) working in the United States, just 45% participate in a retirement plan.  To help grow their retirement savings, women should consider stepping up their work contributions if possible. 

Tracking income sources is critical to good financial health. Your wife should be aware of all the income that is due to her and how to distribute in a tax-efficient manner.  The women in your life should know the answers to these questions:

• How much have you saved in your workplace savings plan?
• Are you aware of how and when to take Social Security?
• Do you understand survivor benefits should your spouse pass away?
• Are you entitled to a pension?
• Do you know if you are eligible for a portion of your husband’s pension or Social Security benefit if you are divorced or widowed?
• What are your life insurance proceeds?

By preparing for the unexpected, you will be able to ward off potential threats that could jeopardize your financial security. This includes the risk of serious illness or disability, the threat of inflation or increasing tax liabilities, a sudden market downturn and the risk of poor investment decisions or inappropriate risk management.  Here is a check-list of some safeguards you can begin to employ if you haven’t already done so:

• Have an emergency fund and proper insurance.
• Make sure you have will, trust and power of attorney documents.
• Manage longevity risk –  Because people are living longer now, make sure that there’s enough income for a longer life.
• Manage risk in an investment portfolio with a good balance between stocks and bonds.
• Know where critical documents are kept and what you would need to do if a spouse or loved one were no longer able to assist with financial decision making.   On my website,  www.SecuredRetirements.com, I have posted a tool called myDashboard, which  is a next-generation financial information and management tool that allows you to organize, store and monitor all of your important financial and personal information in one place, which you can access from anywhere in the world via your own secure and protected Personal Financial Dashboard. 

These examples of good financial strategies are one way of ensuring the women in your life are cared for and are available to you when you partner with a knowledgeable professional like those at Secured Retirement Advisors. In order to help you with these and many other decisions, we have recently updated our website and now offer many FREE downloadable resources which can help answer many retirement questions. Feel free to visit us at www.securedretirements.com and help yourself to our educational materials.  If you would like a complementary “3 Step Review” of your own retirement plan, call Secured Retirement Advisors at 952-460-3260.