On March 8, we celebrate International Women’s Day, a celebration of the social, economic, cultural and political achievements of women. Of course, women still tend to face more obstacles than men in their quest for financial security. Consider a few of them.
For starters, women are even more likely to leave the workforce, at least temporarily, to raise children, which translates into lower contributions to employer-sponsored pension plans such as the 401 (k) s. And it is often women who become the full-time caregivers of aging parents or other family members. Caregiving duties can take a heavy financial toll: lost wages, pensions (including 401 (k) s and similar plans) and social security benefits that a woman loses to become a full-time caregiver. amounted to more than $ 300,000 over his lifetime, according to the National Academy of Sciences.
Women may also be more vulnerable to financial downturns. Consider the COVID-19 pandemic: Just a few months ago, in December, women lost 156,000 jobs, while men gained 16,000, according to the Bureau of Labor Statistics, which also reported that women made up 54 % of jobs lost due to the pandemic. in 2020.
And women are not unaware of their situation and their prospects. According to a survey by Edward Jones and Age Wave, only 41% of women have confidence in retirement, compared to 56% of men.
But if you are a woman, there are steps you can take to improve your financial outlook. Here are some suggestions:
Take full advantage of retirement plans
If you’re still working and your employer offers a 401 (k) or similar pension plan, take full advantage of it. Put in as much as you can afford each year and increase your contributions when your salary increases. Additionally, in your plan, you’ll want to choose the combination of investments that can help you offer the greatest potential for growth, given your individual tolerance for risk. Additionally, even if you are contributing to a 401 (k) or similar plan, you may also be eligible to fund an IRA, giving you even more investment choices.
Evaluate your social security options
You can usually start receiving Social Security benefits at age 62, but your monthly checks will be much larger if you wait until your âfullâ retirement, which will likely be between 66 and 67. be better off taking spousal benefits if you are married and your spouse has made more money than you. You are usually even eligible for spousal benefits if you are divorced, provided you have been married for at least 10 years and have not remarried.
Look for unexpected income opportunities
Even after you officially retire, you can still find ways to receive earned income. Maybe you can work part time or do some counseling. And if you are a caregiver, you may be able to receive compensation for your work. Many local governments pay unmarried caregivers who act as personal attendants, although the rules vary widely from state and county to county.
These are certainly not the only ways to improve your financial situation, but they can be of use to you. Either way, be aware of the challenges ahead and do whatever you can to brighten up your future.
Jennifer Barrett (AAMS) is a local financial advisor to Edward Jones.
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Edward Jones, its employees and financial advisers are not estate planners and cannot provide tax or legal advice. You should consult your estate planning lawyer or qualified tax advisor about your situation.