Throughout the years, society's traditional gender roles have changed drastically. According to a study from the Council on Contemporary Families at the University of Texas, approximately 70% of women can anticipate being their households' primary breadwinners before their children turn 18. Not only that, but for the past twenty years, the most rapid growth of women as principal breadwinners have been, not among unmarried or divorced women, but among women with domestic partners.
Regrettably, while the number of women breadwinners has risen dramatically, financial advisors nor financial service providers who cater to or understand the special financial and investing needs of women have kept pace -- they still tend to cater more toward men. Women's knowledge and understanding of finance and investing are also lagging behind this growth trend due to a long-held perception that these matters are strictly for 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: Female longevity has been known for years, but the magnitude of its financial implications is only just being understood. Because they tend to spend a longer time in retirement and are more likely to require medical care towards the end of their lives, women require more financial resources 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 several assumptions that men are not typically required to manage...Women tend to postpone their careers or take breaks more often than men to provide care. For this reason, it is easy to comprehend that women must tailor their financial strategies with considerations and assumptions not typically taken by males.
Women must become comfortable with investing, not just saving. To build the necessary retirement funds for their future, women should capitalize on opportunities afforded by financial markets that promote long-term growth and stability. Placing money into a savings or money market account might seem like an easy solution but in reality, this option does not provide enough development to gain adequate retirement resources. Moreover, it is no longer reasonable to think that women are too cautious by nature to invest in the stock market. As mentioned earlier, when women have access to accurate information and understand their long-term interests, they normally make wise investment decisions and enjoy better portfolio performance than men. However, the vital factor here is getting reliable information and guidance presented in a way that resonates with women's needs.
Women have resources, they just need to use them. To take charge of their financial future and become confident in their money management strategies, women don't even need to take classes to do it. There are plenty of engaging online materials specifically crafted for this purpose! Here's a quick look at some:
- 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 futures.
As always, if you have any questions about the information in this blog, feel free to reach out to our office.