7 ways women can build a confident and secure retirement plan
Thinking about retirement should be exciting for women. But preparing for financial independence may feel intimidating and stressful—even scary—to some.
If this sounds familiar, take a deep breath because I’ve got good news.
You’re likely more prepared for retirement than you realize.
Whether you’re already working with a trusted financial professional or beginning your search, you have the power to address your retirement planning concerns. Below are seven ways every woman can build her financial confidence and better prepare for a secure financial future.
Way #1: Acknowledge your strengths
From a financial standpoint, women tend to outperform men. A recent study shares that women are not only better savers, but they also earn better investment returns as well.1
Financial confidence and know-how go hand-in-hand, yet some women lack the confidence needed to feel good about their financial decisions.
Here’s why that matters.
YOU are your own best advocate for your financial well-being. The decisions you make now dictate what your retirement will look like. Arm yourself with a team of trusted financial professionals who can help improve your decision-making skills, test your plan, and strategize for every scenario.
Whether you’ve always been the primary caretaker of your family’s finances or you’re new to managing money, you know more than you think you do. You have a vision for what retirement should look like and the desire to make it happen. Now, you need a roadmap to get there.
Way #2: Create a goals-based plan
I mentioned above to visualize your dream retirement. To make it happen, develop a goals-based plan that addresses the crucial details of your plan. Discussing the logistics of your ideal retirement now is necessary to prepare for “what if” scenarios later. Engaging in this exercise helps you work to “avoid the avoidable” and prepare for the unexpected.
Ask yourself questions like,
Where do I want to live in retirement?
What will my monthly expenses be?
Do I want to travel often?
Will I still want to work in retirement?
How much savings should I have to maintain my lifestyle?
Am I in good health, and how can I sustain it?
Answer these questions to better put a “price tag” on your retirement plan. Identifying your retirement savings goals now helps determine the appropriate investment and savings vehicles to meet your retirement needs.
Way #3: Get time on your side
When I talk about getting time on your side, I’m really addressing two things:
Adding more time to build your financial independence, and
Choosing the right time to fulfill your goals.
Timing is everything when it comes to retirement. The longer you contribute to your savings accounts, the greater your compounding interest grows. If your portfolio has experienced recent market volatility, time may allow for a market correction (although performance is never guaranteed).
Timing also impacts your Social Security benefits. Delaying benefits past your full retirement age (67 for those born in 1960 or later) can allow you to earn more income for longer without penalty and maximize your monthly benefits. If you can put off collecting benefits for just a few years, the lifetime difference in Social Security income is significant.
The timing of your goals for retirement is essential as well. From when you retire to how often you plan on traveling, what you do and when you do it can impact your retirement plan. Want to travel every year for the first few years of retirement? You’ll need to have those funds readily available. Looking to take it easy at home for a while? You may have more time to continue contributing to and growing your retirement savings.
Way #4: Build an intentional investment strategy
Regarding women and retirement, I’ve found that your personal financial plan should shape your investment strategy—not the other way around.
You need to be comfortable and confident in your ability to retire. For your portfolio, that typically means minimizing risk while growing what is required to achieve financial independence.
Driven by your own financial goals, you and I can develop a personalized, intentional investment strategy during the retirement planning process.
Way #5: Consider your “what if” scenarios
A woman is expected to spend more on health care costs in her lifetime than her male counterpart. This, coupled with the fact that women statistically outlive men, means there are plenty of “what if” scenarios to consider for retirement.
If you had a medical emergency, how would you pay for it? Would family take care of you, or would you need to utilize a long-term care facility?
Start addressing these concerns now, as it’s always better to have a plan in place before emergency strikes. Things like long-term care insurance, Medicare options, and healthcare savings accounts should be considered as part of your larger retirement planning efforts.
Finances aside, there are things you can do now to help reduce the chance of a medical emergency in retirement. Stay active and exercise several times a week (at an intensity level that’s right for you), make healthy choices, get some sleep, and find ways to cope with anxiety or stress. It’s never too early or too late to make your physical health just as big a priority as your financial health when it comes to preparing for retirement.
Way #6: Don’t neglect your legacy plan
It’s never fun to think about your mortality, so I urge you to consider this:
Your estate plan is an act of love for those you’ll leave behind.
While you can work with a team of professionals to develop a will, identify beneficiaries and address the transferring of your estate, there’s so much more to legacy planning than your financial standings. With enough preparation and consideration, you can give your loved ones the directions they need to make life easier after your passing.
Provide instructions or directions for accessing important documents, including online account passwords or safe combinations. This document should include any recurring bills, income sources, investments, and other necessary financial or legal documentation.
Consider going a step further and let your loved ones know how you’d like to be celebrated after your passing. Making final arrangements is stressful for a grieving spouse or child. Having the costs accounted for in your estate plan, and the details already written down is a lasting gift for your loved ones.
Way #7: Find an advisor you trust
There’s no getting around it: retirement planning is complex. With so much to consider, it often makes sense to work with a trusted financial partner who can do the heavy lifting.
Wealthcare for Women specializes in financial and retirement planning for women over 50 and their families. I work one-on-one with women and their loved ones to develop a holistic financial plan. In doing so, we address each goal, need, and concern about retirement together in an engaging and inclusive environment.
You and your advisor will be working together for years (even decades) to come. That means taking the time now to choose the right partner is key to building and maintaining your financial confidence towards retirement. Always feel free to ask questions, do your research and choose an advisor who best fits your family’s needs.
Wealthcare for Women and retirement planning
Building a financial plan is an integral part of your retirement plan, but more goes into living the retirement you’ve always dreamed of than money. Take time to consider your personal values, hobbies, priorities, and lifestyle goals for your post-work years. While your financial strategy is the tool to get you there, these are the things that make your retirement fulfilling.
Ready to see if I’m a good fit? Wealthcare for Women helps women prepare for, transition to, and thrive in retirement. Feel free to reach out anytime to discuss your own retirement plans.
