Beating Financial Stress: How Successful Women Cope

Kimberly Foss - Beating Financial Stress How Successful Women Cope

Most Americans would admit to suffering at least occasional financial stress; it seems to be a fixture in our culture. But women shoulder more stress than men, according to a recent study by Mercer LLC, an international human resource and benefits consultant. In the survey, 43 percent of women reported being consistently stressed about money. Factors include the fact that women still typically earn 20 percent less than men in the same jobs, and at the same time, women handle more of the caretaking burden for children and other family members.

Significantly, the study also indicated a high inverse correlation between the level of stress women felt and their level of confidence in their financial knowledge. The more financially savvy the woman, the lower her overall stress level. This points up the importance of financial literacy as a foundation of women’s sense of wellbeing.

So what should women do to move from the “consistently financially stressed” category to a greater sense of confidence? Here are a few actionable ideas for women who want to feel less pressured and more assured.

 

1. Have a personal retirement goal and strategy.

Data from Transamerica Center indicate that less than 10 percent of women have ever used a retirement calculator to forecast their future needs. Research suggests that one underlying factor is social norms that undermine women’s ability to gain financial experience and coaching. But women need not settle for life in an “information ghetto.” More and more professional financial planners are recognizing the special needs and priorities of women. Also, resources like DailyWorth and the Women’s Institute for Financial Education (WIFE.org) provide free financial coaching and other resources to help women make smart plans for retirement and beyond.

 

2. Form a regular savings plan, even if you have to start small.

Women overwhelmingly have less money invested than men. One recent study indicated that nationwide, the median amount of money in savings for men was $40,500, compared with $12,400 for women. Clearly, the wage gap is a factor here, but you can still start addressing the problem. Set aside some amount for savings each month, even if it’s only $10. Over time, you can build the “savings habit,” which, more than any other single factor, will help you feel less stressed about money.

 

3. Take full advantage of company benefits.

The ability to contribute to a 401K or other tax-favored plan through your employer is one of the best weapons against financial dependency later in life. Not only that, but the knowledge that you are taking regular steps to meet your long-term goals will give you regular shots in the arm, confidence-wise.

 

4. Track your expenses.

Hate budgeting? Then let technology do it for you! I encourage many of my younger clients to use Mint.com, a free online tool that takes the drudgery out of keeping up with where your money goes. When you know your spending pattern, you are better equipped to take proactive steps like paying off high-interest credit cards, controlling your food costs, and other financially healthy measures.

More often than not, stress is in the eye of the beholder. When you take action on your own behalf, you are making the decision to control your financial stress, rather than the other way around.

 

Stay Diversified, Stay Your Course!