The Woman’s Guide to RetirementFebruary 24th, 2014 by The JetSetter Team | Comments Off on The Woman’s Guide to Retirement
In a January 2012 study by Ameriprise Financial, men held a distinct advantage in retirement planning when compared to their female counterparts. Earlier studies predicted that this might be true—women, in general, don’t feel that they possess enough knowledge and education to make sound financial decisions regarding their retirement.
There are many reasons this might be true—women live longer and therefore retire later or must support themselves for longer, and women still earn less than men working in the same professions. Additionally, women often take time off to have children, for which they aren’t paid, creating an income deficit that can be damaging to retirement.
Women also tend to be more intimidated than men by investment opportunities, which means that (even in the presence of a good salary) they’re making less money through these channels. This lack of confidence stems from an outdated idea that women aren’t good at math or don’t have the financial literacy afforded to their male counterparts.
Fortunately, these ideas are nearly gone. Women are able to save for retirement and should actually begin doing it as soon as they can. Begin by simply opening an account. Time and money are a great combination, and now is the time to maximize both. First, contact your employer to see about 401(k) match programs. You might also check out a brokerage that will help you to open an IRA.
If you’ve already begun saving, try to increase the amount you’re putting into savings by 1% every quarter. For most people, this is about $25-$50 per paycheck and will not be missed. This type of budget and savings plan will open up your additional money for other things—think vacations, home ownership, etc.
Luckily, there are many tools available online to help you determine how much money you’re likely to need for retirement. Online calculators take into consideration things like income, current amount in savings, age, etc. to give you a fairly accurate idea about your financial future.
When you’re saving for retirement (or anything), remember that small amounts of money over a long time make a huge difference. A little over a dollar per day can easily turn into $20,000 over twenty years—quite a sum of money!
For women, it is especially important to work toward your retirement goals early and often, which will provide a large nest egg later in life. For more targeted advice about investment choices, listen to Jason Hartman’s Creating Wealth Show podcast at JasonHartman.com (photo credit: Ed Yourdon via photopin cc)
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The Jetsetter Show Team