December 10, 2009
Today, women are playing an ever-increasing role in making important financial decisions - whether for themselves or for their families. While many of the basic rules of investing hold true for all investors, some life events will affect women differently than they will men, and these can also have an impact on investment decisions. What areas deserve special consideration?
1) Longer life expectancy. People in general are living longer these days, and conventional wisdom will tell you that women tend to outlive men. In fact, according to CDC stats from 2003, women outlive men by an average of more than five years! This means that women in particular often end up facing more years in retirement which calls for special attention to their unique needs.
2) Being on your own. If the upside of being a women is living longer, the downside might be the likelihood of being on your own at some point (as a result of a spouse's death, because of divorce or simply remaining single). Dropping from two incomes down to one would obviously require making some adjustments, so it's important to think about alternatives and options in the event you should be faced with a similar situation.
3) Time spent out of the work force. When caring for children -- or even an elderly parent -- women tend to spend more time away from work than men. Some surveys have shown that, on average, women spend more than a decade out of the work force. The implications for women with regards to investments are clear: they will have less time than their male counterparts to contribute to their retirement nest eggs.
While these are just some of the many important considerations for women investors, there are also several simple steps women can take to come up with an effective financial strategy:
1) For starters, you should look for ways to educate yourself about investments. Reading this blog is a good start!
2) You may also want to seek advice from a professional. The act of enlisting a financial advisor to help with your investments provides you with someone you can turn to for guidance as you make those important decisions.
3) One of the most important things you can do is make a list of your financial goals and then develop strategies to meet those goals. Taking the time to assess your current financial situation will help you get a clear picture of where you are, and then you can envision where you want to go. Keeping in mind the special circumstances we mentioned earlier, you can chart a course of action that will enable you to meet any challenges that may arise in the future.
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).