Retirement planning can be a uniquely stressful and anxiety-inducing experience for women because of the financial burdens they face later in life.
Women typically live longer than men (about five years on average) and are more likely to live their final years alone. Living longer and living alone often means more health problems — which means more medical bills and potentially the need for long-term care. Women also might not have as much saved for retirement because of systemic and societal issues such as the gender pay gap and career interruptions to be the main caretaker for their children, aging parents, or other loved ones.
This financial anxiety around retirement is felt by women throughout the nation. A survey last year by the National Council on Aging and Ipsos found that fully half (51%) of women age 60 and older are worried about outliving their savings. Almost six in 10 women (59%) said they are worried about losing their independence.
Many couples do not anticipate how financially and emotionally painful these later-in-retirement expenses can be. When women don’t take part in financial planning and then lose a spouse or get a divorce, they often find out that they aren’t as prepared for retirement as they thought, or that their asset allocation is inappropriate for their level of risk tolerance.
That’s why it’s so important to regularly talk about these gender inequalities and possible scenarios with your partner and financial advisor. According to UBS, when couples do share in the financial decisions equally, they argue less about money and feel more confident in their financial future.
A Changing Tide
Fortunately, surveys show that more married women are interested in taking a bigger role in their families’ long-term financial planning.
In a UBS survey, 64% of married women said they have a greater interest in discussing financial planning with their spouse due to COVID-19. Sixty-three percent said the crisis has affected how they think about money, and 51% said they intend to discuss their inheritance plans with their children because of the virus.
“The consistent message that we need to get across with couples is that long-term financial planning is just not something that can be delegated,” said Liz Sheehan of UBS in the Barron’s article. “You both have to be sitting at the same table for that conversation.”
Prepare for Retirement with The Humphreys Group
It’s important for couples to have open conversations about retirement now. A financial advisor can help facilitate these hard conversations and create a strategic comprehensive retirement plan that addresses these issues.
A financial advisor can help you with every facet of retirement planning — from Social Security optimization, addressing debt, planning for end-of-life costs for both partners, and creating a retirement plan that safeguards you from the “survivor trap.” Start planning for retirement today with The Humphreys Group. Contact us today.