Anyone who is a mom, has a mom - or even just knows a mom - understands their lives are mostly about giving: giving birth, giving advice, giving kids and their friends a lift, and giving money … lots and lots of money.
For Mother's Day, we would like to encourage all of you moms to spend a few minutes taking: take a break, take stock of your financial future and take any opportunities to increase your long-term security. In keeping with the theme, you may begin by taking these steps.
- Take stock of your finances, including all your assets, debt and financial goals. Schedule a “money date” to give yourself the gift of a clear understanding of what you have, what you owe and plans for reaching your financial goals. This includes a realistic evaluation and plan to eliminate outstanding debt. By taking control of high-interest debt you position yourself to save money, improve your credit score and take advantage of financial opportunities whenever they come along.
- Take a little money and set it aside now, to have a more comfortable retirement later. If you work outside your home, sign up for your employer's retirement plan and try to contribute at least enough to qualify for any company match. Not doing so is the equivalent of turning down free money. And since nobody (not even a mom) knows everything, consider consulting a professional advisor. Women who consult financial professionals may feel less stress about money, since research shows they are more likely to consider themselves on schedule, financially.
- Take the time to ensure you have adequate life insurance coverage. This is important, especially if you have children. Women who are dependent on spousal income are particularly vulnerable, but even working moms may be at a serious financial disadvantage if they are left to bring up a family alone. Generally, you should have life insurance coverage that equals eight-to-10 times your annual household income.
- Take a deep breath - and update your will. If you die without a will, the state determines how your estate is distributed, a process that may not meet your unique needs. For example, if you are a surviving spouse, you may get only a fraction of your husband's assets, with the rest going to your children. If you and your spouse both die, the state decides who will raise your kids. While you’re at it, name a legal guardian for your minor children. Casual agreements with relatives do not have the legal standing of a formal guardianship.
While many moms share responsibility for generating income and managing daily household costs, too few women still feel confident in their ability to meet their long-term financial goals. While it’s nice to receive flowers or a sweet card on Mother’s Day, taking charge of your finances for yourself may provide you with peace of mind that lasts year-round.