3 Things Working Women Should Do Now to Secure Their Financial Future

3 Things Working Women Should Do Now to Secure Their Financial Future

September 04, 2019

The wealth gap is real! The retirement wealth gap between men and women brings me to tears. Study after study concludes that women are falling behind when it comes to preparing for retirement. This same conclusion was illustrated in a study conducted by T Rowe Price, entitled, "Helping Millenial Women Close the Retirement Savings Gap."  One critical insight from the research was my fuel for this month's blog:

45%-Almost half of women who have been retired 11 years or more are widowed or divorced compared to just 18% of men.

Women will likely end up alone and possibly outlive their money. To help mitigate the depressing financial outcomes of retirement for women, every working woman should do these three things to help secure her financial future:

Contribute to a Retirement Plan

If you work for an employer who offers a 401(k), 403(b), or a 457 plan, start contributing to the plan. Take baby steps by starting with a contribution level of 3% of your salary. See how that feels. I doubt you will see a significant difference in your paycheck. You can gradually work your way up to the company match.  

For my female entrepreneurs, don't forget about your retirement. You have options too! I know as a small business owner, your priority is making money. But once you start making money, start socking a few dollars away for your future. You can create a Solo 401(k) or a SEP IRA that will allow you to contribute more than you could to a traditional IRA account.

According to the research done by T Rowe Price, "...working baby boomer women are contributing less to their 401(k)s than men—a median of 7% compared with 10% for men."

Automate Wealth Building

Setting up automatic contributions to any of your wealth-building buckets (savings, investments, retirement) each month takes the pressure off of you remembering to do it yourself. You also do not have to worry about something coming up that will suddenly be more important than your contributions. Even if you have to take the money back out of a savings account, you will have time to think whether the withdrawal is worth you not meeting your financial goal.

Write Down Your Financial Goals

I know some of you may be thinking how can writing down a goal help you secure your financial future. Well, seeing is believing! More than a decade ago, I wrote down a dollar amount that I wanted to reach before the age of 50! A few times a year since writing down my number, I check to see if I'm close to my goal. When I wasn't close (yes, I met my goal), I ran a few calculations to determine what I needed to do to get there. Visualization works. We can achieve what we believe.

Acknowledging where you are financially is a starting point but not your final destination. Do realize, however, that as a woman, we may be alone in the end.  We must start planning now for that bleak possibility.

About Terrell Dinkins, MBA, ChFC®, CDFA®

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Terrell Dinkins, MBA, ChFC®, CDFA® is an investment adviser representative of and offers investment advisory services through OBN Wealth Advisors, LLC, a registered investment adviser offering advisory services in the State of Georgia and other jurisdictions where registered or exempted. Main Office: 950 Eagles Landing Pkwy, Suite 216, Stockbridge, GA 30281. Tel: 404-723-9780. Website: OBN Wealth Advisors. Image courtesy of Gerd Altman from Pixabay.