Financial Planning for Women, by Women
Delta Community Retirement & Investment Services
Financial planning for women and men both begin with understanding where you are today and where you’re trying to go. However, women are faced with unique lifestyle and economic issues that require specific care and attention. For example, on average, women live longer and earn less than men. They are more likely to manage the household budget. And in many cases, women face the demands of caring for children, aging parents or spouses.
Taking time away from the workforce impacts career advancement, their ability to save or participate in company-sponsored retirement plans and limits their Social Security benefits.
Research has shown that, overall, women tend to focus on progressing toward a set of financial goals like sending children to college, retiring comfortably or leaving a legacy, just to name a few. Regardless of your personal or professional path in life, you can always work toward achieving a more secure future for yourself and your loved ones. It’s never too early or too late to start planning for a better tomorrow. The following are important financial planning topics and tasks for single and married women to consider:
- Be engaged and participate in all household financial decisions.
- Educate yourself on your financial resources before making large purchases.
- Do not co-mingle or jointly title assets with a non-spouse (roommate, partner, parent, adult child, etc.).
- Always review your tax returns before signing to ensure income and expenses are thoroughly accounted for. Remember, you are responsible for all information represented, regardless of who prepared the return.
- Read all legal documents carefully before signing them (mortgage applications, business contracts, Wills, Financial Power of Attorney, etc.) and ask questions about anything that is unclear.
- According to research, money issues are one of the leading causes of divorce in the United States. It’s important to have detailed saving and spending discussions with your spouse to set expectations on mutual and individual finances.
- When appropriate include your financial advisor/planner, attorney and accountant in family meetings about finances.
- Talk with a financial professional and evaluate the potential for underlying risk and volatility in your investments.
- Be sure you have an audience with your financial advisor/planner—your financial future is at stake.
- Establish credit in your own name, including having a credit card(s) set up with you as the primary account holder.
- Pull your credit report, annually, by visiting www.annualcreditreport.com to review outstanding debts and protect against identity theft. This is a free service.
- Make sure your finances are strong enough to support your needs before making the commitment to helping others, including your adult children.
- Stay informed about your and your spouse’s employee benefits at each open enrollment (medical, dental and vision insurance, disability and life insurance, retirement plans, etc.).
- If you or your spouse are active or retired military, you should research and understand your accessibility to Tri-Care (government-managed health insurance) and survivor benefits for you and your children (life insurance, pension benefits, burial accommodations, etc.).
- Determine if your disability and life insurance are adequate to maintain your lifestyle following the loss of your partner’s/spouse’s/roommate’s monthly income and household contribution:
- Create an action plan for the loss of household income.
- Separate survival from discretionary expenses and be ready to cut costs immediately upon reduction or loss of income.
- Establish a written family plan for long-term care. Outline who will take care of you, where you will receive the care, and triggers for activating your plan. Consider whether long-term care insurance is right for you.
- Research and consider purchasing an umbrella liability policy.
Retirement and Death
- Save for retirement in your own name using a 401(k), IRA or other retirement savings account.
- Spousal income can be used to determine eligibility to contribute to a Traditional or Roth IRA.
- Understand the difference in value between non-retirement (checking, savings, money market, etc.) and retirement assets (401(k)s, IRAs, health savings accounts, etc.), including the taxation and accessibility of both.
- Participate in pension and Social Security election decisions. In a divorce, do not waive your spousal rights without understanding what benefits you are giving up.
- A “non-spouse” cannot waive spousal rights. The Employee Retirement Income Security Act of 1974 (ERISA) governing retirement plans mandates the spouse to be the beneficiary of retirement accounts, unless the spouse waives her rights in writing after marriage. If you agree to a pre-nuptial agreement, be sure to educate yourself on the assets that are not included.
- Before retiring and leaving your salary and vacation benefits, practice living on a reduced income. Meet with a CERTIFIED FINANCIAL PLANNER™ professional to determine your retirement readiness.
- Understand the titling of your home and your vehicles; this means who is listed as the legal owner of these assets on property deeds and vehicle registrations. What will happen to those assets if you or your spouse/partner passes away?
- Retain a copy of all beneficiary election forms for your insurance and investments. Be sure all ex-partners have been removed as beneficiaries. If you can’t find a copy of this form, submit a Change of Beneficiary form to your financial institutions (and keep a copy); this can sometimes be done online.
How We Can Help
Whether you have a partner or are going at this alone, Delta Community can help you decide how to manage your financial life as you look forward to the future. We want to provide you with detailed information and tailored options so you are empowered to make optimal decisions that meet your individual needs. Consider meeting with one of our CERTIFIED FINANCIAL PLANNER™ professionals to review and discuss your joint goals and if a family plan could help better unify your finances for a stronger future.
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Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker/dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Delta Community Credit Union and Delta Community Retirement & Investment Services are not registered as a broker/dealer or investment advisor. Registered representatives of LPL offer products and services using Delta Community Retirement & Investment Services, and may also be employees of Delta Community Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from and not affiliates of Delta Community Credit Union or Delta Community Retirement & Investment Services. The Delta Community Retirement & Investment Services site is designed for U.S. residents only. The services offered within this site are offered exclusively through our U.S. registered representatives. LPL Financial Registered Representatives associated with this site are licensed in all 50 states.
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