Despite the lingering societal stereotypes, the days of males being the primary breadwinners in American households are long gone. According to research from the Council on Contemporary Families at the University of Texas, 70% of women can expect to be the primary breadwinners for their households at some point before their children turn 18. Not only that, but for the past twenty years, the most rapid growth of women as principal breadwinners has been, not among unmarried or divorced women, but among women with domestic partners.
Unfortunately, the rapid growth in women breadwinners has not generally been accompanied by a similar rise in either women’s general knowledge and understanding of finance and investing or in financial service providers and advisors who cater to or understand the special financial and investing needs of women. For too long, finance and investing has been seen as the domain of men.
This means that it is vital that women breadwinners should keep a few key principles in mind as they take charge of their financial futures. Research demonstrates that, contrary to stereotypes, women are often better investors than their male counterparts, but their needs and challenges are different. Knowing the implications of these differences is a huge advantage for women as they plan their financial strategies.
Women live longer. Women’s generally longer lifespans have been a known fact for years, but only recently have we begun coming to grips with the long-term financial implications. Because they tend to live longer in retirement (and are more likely to require healthcare in their later years, women require more financial resources in order to avoid outliving their savings. Add to this the fact that women interrupt or postpone their careers for caregiving purposes far more often than men, and it’s easy to see that women’s financial strategies need to incorporate a number of assumptions that men are not typically required to manage.
Women need to get comfortable with investing, not just saving. One important way for women to address their greater need for retirement savings is by utilizing the opportunities for long-term growth presented by the financial markets. For most women, just socking money away in a savings or money market account isn’t going to provide sufficient growth to achieve the type of retirement resources they’re going to need. Further, it is no longer valid to assume that women are, by nature, too conservative to invest in the stock market. As mentioned above, women who have access to the right information and who understand their long-term needs generally make sound investment decisions and enjoy better portfolio performance than men. But the all-important key is access to authoritative information and advice, presented in a way that makes sense to women and takes their chief concerns into account.
Women have resources; they just need to use them. The most important thing for any woman to do when she is taking charge of her financial future is to educate herself. And you don’t have to enroll in classes to do it. There are many excellent online resources designed especially to help women learn what they need to know to be confident and self-directed with their financial and investing strategies. Here are just a few:
- Women’s Institute for Financial Education (WIFE)
- Ellevest (available online and as an app)
- The Female Economist
- HerMoney
And there are many more. Using these sites and apps as information hubs, women can start educating themselves, the all-important first step in removing the mystery from the world of finance and taking charge of their own futures.
At Empyrion Wealth Management, we specialize in helping women in transition and others take more control over their financial futures. As a fiduciary financial advisor, we place our clients’ best interests ahead of everything else, providing the guidance, research, and other tools you need to chart your own course toward a financially secure future. To learn more, click here to read our whitepaper, “Suddenly Single: Financial Independence for Divorced Women.”
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