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Point CPA

 

P.O. Box 1411 Bismarck, ND 58502-1411

 

 

July/August 2021

Why Are Women Behind Financially?

Why Are Women Behind Financially

Women tend to lag behind in accumulating assets because they’re more likely than men to leave the workforce to care for their young children or, in later years, to act as caregivers for elderly family members. Spending time away from a job may mean missing out on several years of contributing to an employer’s retirement plan. It can also result in lost opportunities for promotion and subsequent salary increases.


Ultimately, being out of the workforce can mean lower Social Security benefits in retirement. And a woman’s longer life expectancy may contribute to higher lifetime healthcare costs in addition to the extended need for income.


Take Charge of Your Finances

  • Work as long as possible to maximize your savings and your Social Security benefits.

  • Contribute the maximum amount to an employer’s retirement plan account. Consider contributing to an IRA, which may or may not be tax deductible.

  • Take more investment risk if your tolerance allows. Investing too conservatively can slow progress toward your savings goals, so don’t rely on only fixed-income investments.

  • Create an emergency fund.

  • If you’re married but not working, your spouse may be able to contribute up to $6,000 ($7,000 if you’re age 50 or older) to a spousal IRA for you.

  • If you think your sources of income, such as Social Security and any pensions, won‘t cover your expenses in retirement, consider investing in an annuity that will generate regular income to help fill the gap.

  • Reduce your living expenses by moving to an area with lower taxes and housing costs. If you’re not married, consider sharing a residence with friends.

  • Consult your financial and tax professionals to help ensure you make well-informed decisions.


*https://www.voanews.com/science-health/new-study-looks-why-females-live-longer-males


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