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Practical Planning Tip: Women and Wealth - Recurring Themes

March 15, 2024

Today we’re going to continue our discussion of women & wealth. Since it is Women’s history month, The videos through the end of March will be on this topic and TODAY I will discuss Recurring Themes that come up when managing the investments and financial planning process with women.

Some of these themes that arise when working with women include:

  1. Longevity risk: In 2016, the life expectancy for U.S. females was 81.1 years, as opposed to 76.1 for U.S. males. Not only are women living longer than their male counterparts, but also this life expectancy delta is actually growing. In fact, 74% of women die single, which makes it imperative for females to stay in control of their own finances.

 

  1. Different earnings: As I already mentioned, Studies have shown that women earn 83 cents for every dollar earned by men. That’s a $900,000 disparity (or more) over a lifetime for some individuals.

 

  1. Financial Transitions: Approximately two-thirds of women between the ages of 40 and 79 have experienced a major financial transition in their lives, including divorce, widowhood, or becoming the primary caregiver for a parent or spouse. Women may also experience transitions at the beginning of their careers if they leave the workforce for childbirth or to raise children.

 

  1. Investor psychology: There is a difference in temperament and overall psychology for women compared to men when it comes to investing. There have been various studies, in both finance and other fields, illustrating how women are more risk averse than men. This has a direct impact on the way women manage their finances. There are also other very positive psychological benefits that women have over men that I will discuss in a few days. AND…

 

  1. Delegation of financial decisions: Despite continued financial success and independence, 56% of married women still delegate money-related decisions to their husbands.

We are going to see these five themes come up again and again during the videos over the next two weeks and I plan to address how to plan and strategize around them.

 

You can WATCH the full video here.