Women and Retirement - Start Preparing Now

As much as we all hate to admit it, financial planning - for business and for personal use - has long been an activity that falls on male hands. Although the majority of us women handle the day-to-day financial aspects of running a family, few of us spend the same amount of time on creating long-term plans. In fact, only about 45% of women participate in a retirement plan where they work, compared to almost twice that for men. (Statistics exclude Australia as your employer is required to pay into Superannuation where applicable).

Many of us who do take this important step in financial planning tend to use that money too early, especially, when the family is in financial trouble. Despite the fact that we continue to strive for more equality for us in the workplace, we continue to miss out on opportunities to prepare for our retirement years. 

Why Retirement Planning is Important

If you retire at 65, you could have up to 25 or 35 years of retirement ahead of you. These days, very few women are investing in preparation for these so-called relaxation years, and over half of us women will end up working long after the age of 65. And those who do retire often find it difficult to maintain a high quality of life because the cost of living increases at a higher rate than our returns. 

For some women, retirement and financial planning isn't considered a top priority, whether it's because we consider ourselves too busy or we intend to share in the support and long-term planning of a spouse or other long-term partner. The reality is that half of all marriages fail, and oftentimes to catastrophic financial damages. Even if a couple does make it to the "golden years" together, it is considered unwise financial planning to put all our eggs in one basket, so to speak. With two retirement funds, most couples will be better off over the long term, whether they are still together or separated when the time for retirement hits. 

How Women Can Prepare for Retirement 

Part of the problem for many of us is that we don't know where to start with our financial future. The financial world can be complicated to navigate, and many of us suffer from a misapprehension that we might be discriminated against based on our gender (hence, Femvestorsglobal was formed!)

With the right financial advisor, this will never be the case. The best thing any of us can do is to educate ourselves and start small. As you learn more and start to build relationships with our team, you can start investing in bigger things and making more informed money choices. 

To start out, you should be making full use of your employer's retirement program. This will stand you in good stead later, but don't depend only on this. Investing in low risk index funds is an excellent way for women to get started in investing. These lock your money in for a specific term, which is perfect if you can't handle the temptation of having money in the bank. 

Thanks to advances in technology and financial options, there are a number of investment options that women can take part in. We support and educate you and help you choose the methods that work best for you and your family. This is an important part of planning for your financial future and will make all the difference when the time comes to retire and start enjoying those golden years with those you love.

Article Source: https://EzineArticles.com/expert/Wesley_Watkis/362080

Ladies- Why Do We Need To Invest?

It is vitally important in this current day and age for all of us to begin taking control of our financial situation and start planning for our future, and the futures of our children. 

We can no longer rely on the government to hand out an aged pension once we retire. We cannot take for granted that at the end of our working life we will be taken care of financially. 

The world population is ageing, due to the baby boomer generation, and within 30 years there will be so many retired people, compared to the number of working age people, that it will be economically impossible for the government to afford to provide any reasonable source of monetary assistance for the elderly. 

The Australian government realised this, that is why they introduced the compulsory employer paid superannuation scheme and are even now beginning to give financial incentives to Self-Funded retirees. 

(For non Australians, the Superannuation scheme (also known as 'super'), is a way of saving money while you are working, so that you will have money when you retire. Whist working, your employer is required to allocate a percentage of your salary each pay, to make sure you have money to live on in the future. The U.S. equivalent to a Superannuation plan would be defined benefit or defined contribution plans).

Most of us have never sat down and even considered the ramifications of why the compulsory super was introduced and for many of us it is a matter of too little too late. Even for the young women in our society - who have a full working life ahead of them, they still cannot rest assured of a comfortable retirement. 

Why is this? It is because that unfortunately even with contributions at the current level of less than 10%, someone on an average wage who works continually for 30 years, is still going to find themselves trying to survive on an income equivalent to less than $20,000,00 per annum in today's dollars. 

You will notice that I said continually working for 30 years. This is another reason why women are particularly disadvantaged. Firstly because they often have to take up to ten years leave from the workforce to raise children, secondly because women in general earn less than their male counterparts and thirdly because an enormous proportion of the women in Australia, for example, will never have received any superannuation contributions, prior to the compulsory superannuation being introduced, and will therefore not have had contributions made over their entire working life so far, giving them even less to fall back on by the time they retire. 

Many women may previously not have thought of lack of superannuation contributions as being a problem, as their husbands may have been contributing to super since they first began work. Unfortunately though with the high number of divorces in this country, it is unwise to rely on the fact that your partner's superannuation will be there for you in your retirement years and even if a large proportion is awarded in a settlement - that it will be sufficient to sustain a comfortable retirement for any length of time. 

All of these factors are why women now more than ever, need to begin taking action to build up a source of ongoing income, that will grow to such an extent, as to be able to provide a secure and happy future for themselves and their children. 

It needs to be a source of income that is unrelated to physical work...that is an income that is generated from income producing assets - and not from our personal efforts. 

One of the best sources of creating this ongoing income stream is to begin building an investment property portfolio, also aptly paraphrased as bricks and mortar. 

We need to start investing in income producing assets now, so that they will have time to grow and develop so that we will be financially independent for our retirement years. 

The most important concept to grasp in relation to building wealth for retirement and for creating finances that can be directed toward charities, or helping out your family is that of Compound interest.

 In mathematical terms 72 divided by Compound Interest Rate of Return = Years for Money to Double in Value. 

Therefore if you have $1,000.00 invested at 10% interest, then the number of years that it will take for your money to double to $2,000.00 is 7.2. It will quadruple in 14.4 years and be worth 8 times as much in just over 21 years. 

If your money is invested at 7% interest, then it will take approximately ten years to double in value. If it is invested at 5% it will double in just over fourteen years. 

The two most important aspects of compounding are one: rate and two: time. The higher the rate and the longer the time something is left to compound, the greater the final result will be. 

This is why the sooner we start investing, the better. 

Article Source: https://EzineArticles.com/expert/Debra_Lohrere/27054

Why Us Women Fall Off the Financial Cliff

Why do so many women leave their financial future to chance? Why do women face so many challenges with their finances? If you could learn how to overcome your financial concerns, would you take action? After speaking to several women, which is the reason for writing my book which will be published later this year "Femvestors". Women don't get involved with their financial security. We leave it up to a myriad of other possibilities. 

Us women already face additional challenges that are unique. First, we have a longer life expectancy. According to "Statista 2021 Report" for developed countries, the average life expectancy for a man is age 79 and for a woman it is age 82. That's a 3 year difference, which means retirement savings must last longer. With longer life expectancy comes the possibility of health issues and the need for long term care planning. 

According to the World Economic Forum Global Gender Gap Report 2020, worldwide, women on average earn around 20% less than our male counterparts for equally valuable work. Major variations exist across countries and regions- the gender wage gap ranges from 3% in Luxembourg to a staggering 37% in South Korea  – no country in the world has yet achieved income parity, however, Iceland is on track to become one of the first countries to achieve this. The impact is that we are contributing less to our pensions, superannuation, 401ks and social security, resulting in less retirement savings to draw income from in retirement. We also have less discretionary funds to invest and save to sustain our lifestyles now and in the future. 

Women also fall into the role of primary care giver taking more time off from our careers to fulfill care giving roles to either our children, elderly parents or a sick spouse. Less time earning income further reduces their ability to save. 

Women tend to rely on our partner to manage investments, balance budgets, and create financial plans. With the divorce rate at 50% (and climbing post Covid), us women could find ourselves single and not knowing where our money is or how much it is worth. Even worse, not knowing if our partner carefully managed the family assets or possibly squandered them away. For the widowed woman it may mean trying to manage our finances with little knowledge at a much older age after a lifetime of being out of the financial picture. Many women don't plan for the possibility that we may lose our partner's pension and other benefits. Either of these cases could come with detrimental effects.

Lack of financial knowledge ranks high on the list of challenges facing us. Traditionally, we are not encouraged to educate ourselves on financial issues. More than 70% of men say they have a good understanding of stock market basics, but less than 45% of women feel that way. This puts us at a disadvantage to our male counterparts. This lack of knowledge leads us to be more conservative, under utilising stocks, bonds and other invests. As a result our long term returns and ability to hedge inflation are affected. Research released by HSBC showed that many women are not prepared for retirement, with just 24% of women in their 50's claiming to have a financial plan in place. 

After learning about the challenges us women face with our finances, do you want to leave your financial future to chance? What are you ready to do to overcome these financial concerns? Please consider taking charge of your future by working on a financial plan. Don't let a longer life expectancy, lower earnings, and lack of financial knowledge take you off course. Make a plan to take charge today!

 

Article Source: https://EzineArticles.com/expert/Bill_Leavitt/1496352

A Woman Needs Cash

Are you thinking - how much money will I need to have invested so that I reach a point in my life where I will no longer have to work - and maybe I work only because I chose to? Imagine - you get up every morning knowing that you completely design your day and that your financial needs are handled. Will you want to alter your lifestyle a few years from now?

Let's say you're now forty years old. You're single with an annual income of $60,000. Your closet holds clothes you adore, you eat out occasionally, go to the movies on weekends, go to concerts every now and then, and enjoy a vacation away from home once a year. Or perhaps you're married with a joint income of $100,000. You and your Partner get away on weekends, drive two cars, play tennis, entertain friends as well as generally travel each year (excluding Covid periods). 

Now, how much cash will you need in order to continue that lifestyle once you stop working? The temptation is to say, "A lot." But how much is a lot? And where is it going to come from? There's an old saying about how you find wealth: You can marry it, inherit it, or earn it. (Of course, you can also steal it-but stealing rarely works for long run, and we're going to keep things honest here.) Let's say the only wealth you have and are likely to have is what you earn. And with your $100,000 salary, you spend about $6,000 a month for mortgage payments or rent, car payments, clothes, food, entertainment, and credit cards. To maintain this lifestyle, you'll need to have invested $1 million by the time you stop working so that at a (fairly typical) 10% rate of return, you and your husband can continue to receive the same income as you do now- $100,000 a year. 

Similarly, with a yearly income of $60,000, you'll need to have invested $600,000 by the time you ease out of working in order to support your lifestyle. 

Basically, then, you can add another zero to whatever you currently earn to determine a ballpark figure of how much you will need to have by the time you ease out of working so that you can maintain your present cash flow. 

Of course, inflation changes that canvas. You won't know what the rate of inflation will be at the time you decide to stop working, but inflation has been running at an average rate of 3% per year for the past decade. A moderate inflation rate, like the one we've experienced over the past decade, will increase the amount of savings you will need by a greater or lesser extent, depending on how far into the future you plan to live on the cash flow from your investments. 

Now, that $1 million we just discussed might seem like a whole lot of money. But let me tell you about a jewel for your financial treasure chest. This second gem is called the "Rule of 72." It's a simple mathematical calculation to help you understand the growth of your money. Here's how it works. Take whatever rate of return you expect to earn, and divide the number 72 by it to determine how many years it will take for your money to double at that rate.

For example, let's say the rate of return you use is 10%, as an average rate of return in the stock market. Divide 72 by 10. This equals 7.2. That means it will take almost seven and a half years for our money to double at that rate. Why use the stock market? Because it's the fastest and most proven way to double your money. A savings account at a bank currently averages 1%, and it would therefore take seventy-two years for your money to double. Underlying the Rule of 72, then, is the principle that a fair rate of return makes a significant difference in the growth of your money. 

The Rule of 72 is a handy tool for forecasting the growth of your money and determining its future potential for you. And it exemplifies the power money can have for women. Who would want to miss the opportunity to put this resource to work in her life?

 Voila!, by adding a zero to your current income you will determine how much money you target to save - and by saving dollars in an investment account - and monitoring the growth of this money on a yearly basis you can determine how quickly you will be a woman with cash and the financial freedom that you can create for yourself. 

Article Source: https://EzineArticles.com/expert/Joan_Perry/216137

Retirement Planning Tips For Women

A lot of the attention to retirement planning lately has been spent on preparing men for retirement. It's devastating to see that since us women generally live longer than men, nothing is openly discussed about how those savings stretch further to compensate for the additional years women live as a comparative. 

But, if a majority of male baby boomers are having trouble saving for retirement, are female baby boomers in the same boat?

You don't have to answer. I'll pretend you nodded. 

This article will talk about how women can plan for their retirement and start saving for their retirement lives. 

Setting up a retirement plan and saving for your retirement may be many years away for you but, if you start early, especially in your twenties and thirties and do that until you retire in your fifties and sixties, you'll have a much more comfortable retirement than your female counterparts who didn't save anything and now are relying on the government to help them out. 

Planning for your retirement may seem too far in the future but it can be here before you know it and the sooner you start saving the better off you'll be when it sneaks up on you. 

Studies show that there are 60 million working women out there and a little less than half are enrolled in a retirement plan. It will be hard to have a retirement fund if there are no contributions to it. 

Women don't work as long as men do at the same job. This is due to taking time off to care for the family to raise the kids. So women don't build up the required years to qualify for a sizable pension or retirement plan, leaving them with little or no savings from the companies they are working for. 

Women live longer than men. If you retire at 55, you can expect to live another 27 years on average. Men can expect to live another 23 years on average. If you're married and your husband was the bread winner and you have no retirement savings of your own, where will the income come from for those extra 4 years? 

Women also are risk averse when it comes to investing, choosing to invest in conservative investments and bonds which have guaranteed returns but lower overall returns. You'll preserve your capital but you won't have much to show for it when you retire and start drawing on those savings. So the choice is either have more money working for you in low, but safe, investment vehicles as you near retirement or invest more aggressively. 

Either way, women need to read about retirement planning as much or even more so than men because we will be spending more of our life in retirement. Talk to a financial advisor, read retirement planning books and check out all the free resources out there to help you save for your retirement. Most people have less than $USD60,000 saved in a 401k or IRA. The average Australian superfund is $A180k and average UK Pension is 80K GBP. There is no way this will last men or women for 20+ years of retirement. Government are not going to be able to supplement everyone... 

Article Source: https://EzineArticles.com/expert/Chris_Campos/110750 

Get Out of Debt: 5 Tips for Taking Charge of your Finances

Getting out of debt and creating a stable financial future may seem like an impossible feat. You could be wondering, “How did I get here?” or “How can I get out of debt when my income is the same as it was before, and I owe even more money?” 

In order to gain a positive and realistic view of your finances, you should instead ask yourself, “What can I change to insure that I have savings, not debt, when I retire?” or “What is my attitude towards money, and how has it affected my financial situation?” By doing this, you can get to the root of the problem and begin tackling your debt in a practical manner. (Remember it may take a little time to get back on track). Here are five methods that can help you take charge of your finances: 

1) Live within your means 

This seems easy enough, but how many people have racked up hundreds or even thousands of dollars in credit card debt? If you have to rely on your credit cards, then you are clearly not living within your means. The most obvious and suitable way to get out of debt is by resisting the temptation to buy stuff you don’t need. Depriving yourself of things you want can be the most difficult thing to do. However, buying whatever you want can also the most damaging to your financial success. Maybe you did get a great deal on those shoes, but is it worth that extra $50 to $100 interest that your credit card may eventually accrue? When you have the desire to buy something, think it through. 

You can also make lists before you go to the store to prevent impulse buying. Even if you are just going to get groceries, you should bring a list and stick to it. Otherwise, you may end up spending $50 more than you thought you would on unnecessary purchases. 

Another change you can make to get out of debt is to start shopping for the holidays and/or birthdays well ahead of time. Many people put off shopping until the last minute and end up charging it all to their high interest credit cards. Why not start early this year and pay for all of your gifts in cash? Try buying one gift a week. By paying with money that you actually have, you will be saving yourself a lot of money in credit card charges. You will also be less stressed when the holidays or birthdays come around because you will already have your shopping finished.

2) Create a budget of all of your necessary expenses and stick with it 

Notice how “stick with it” was added onto that sentence? That’s because almost anyone can sit down and write out a budget. The real challenge is tracking and maintaining it. If having a program on your computer or app on your mobile helps, go for it. Just be sure to save all of your receipts throughout the day and then input them into your app/program. It is important to give each of your expense categories, such as rent/mortgage, food, and utilities, a realistic limit. 

If you only buy according to your budget, you will probably find yourself with extra money each month. With this extra money you can take charge of your finances, get out of debt, and start saving for the future. It will also help you to figure out which items are draining money from your budget. For example, if you buy lunch at work everyday for $8.00, you would be better off making your meals at home and then bringing lunch to work. Just remember that it takes many small steps to resolve your finances and take charge. 

3) Set Realistic Expectations for Your Future 

 Yes. The average person’s salary increase averages between 1.5% and 3.5% per year. And you may be beginning to expect that yearly raise or anticipating that big promotion because then you will be able to pay off your debt. Many people have the attitude that their debt is fine because they will have more money next year to compensate for their spending. It’s the adage, “Why do today what you can put it off until tomorrow?” They spend beyond their means because they are banking on the fact that they will be making more money later. And when they receive a raise, instead of paying off debt, they increase their spending because they think they have more money to spend. The reality is that living this way can extinguish any future financial stability. Also, what if the raise never comes? The promotion never happens, or something worse occurs, such as getting fired or laid off? Then you will be left with all this debt, out of control spending habits, and no money in the bank. 

So, when you receive a bonus or small raise, take that money and pay off your debt or put it towards your savings. Even if you think that you have great job security, be prepared for the unexpected. If you expect that you will be making more money, you will spend it; however, if you acknowledge that your prosperity could end at any time, you will save it. 

4) Pay your unsecured debt off—ASAP 

I know this can be a very daunting task, especially when you have several credit cards with large balances on them. You may think that you will never get out of debt. Your best bet is to begin with the credit card with the smallest balance; pay as much as you can on it each month (try to make it at least double or triple your minimum balance) while maintaining the minimum balances on your other cards until the card is paid off. This will help you to work towards your goals and will help motivate you to pay off your other cards. 

Remember, if you just pay the minimum balances, you are probably barely covering the interest. You could potentially end up paying double or triple for an item you bought a year or two ago.

5) Plan for the long term 

It’s important to plan for your retirement now, so you can enjoy it later. Look into an IRA, 401(k) program, Superannuation fund, CPP or Pension (dependent upon your geographical location). Usually your employer’s program will simply deduct money from your paycheck each month. That is one of the easiest ways to do it because you’re saving money each month without really missing it. Some employers even have a matching program if you contribute enough to your fund each year. 

Also, in order to plan for the future, you need to calculate how much money you will need if you live for another twenty years after you retire. Be sure to take into account the cost of living in your area or the area where you plan to retire. You may be living well right now, but planning and saving so that you can retire comfortably is crucial. 

Follow us on Social Media and our weekly blogs to discover how to get out of debt, save and invest your money wisely

Article Source: https://EzineArticles.com/expert/John_H._Tran/61724 

What Women Need To Know About Money

Life is definitely more than just about money. There are so many things to know about money. The list is endless, but here are a list of important things you as a woman should know about money:

1. Men and Women are Different

Understand that men and women are different in how we use money, how we feel about money, and how we communicate about money. In most relationships one partner will be the spender and one will be a saver. Understand the differences of each and take the positives of both personalities to make the most out of your money and your relationship. Set time aside each month to have a "money date." A money date is once or twice a month where you and your spouse go over your finances together. You can use this time to pay bills, review your expenses, review your investments and to use this time to understand and appreciate how you and your spouse view money. Discuss your monthly spending and saving. If you are single, your money date can be with either researching yourself or alternatively with a Financial Advisor.

If women stay at home to care for the kids, on average they stay at home for 11 ½ years. That is 11 ½ years that they don't have money going into a retirement plan or social security. Also, it costs more as women to live. Just look at drycleaning. Women's shirts cost more than men's. What about haircuts? Women's haircuts cost more than men. Also, women live on average 7 years longer than men. Plus women tend to care for others before they care for themselves.

Also, we as women tend to be more conservative investors. A recent Bloomberg survey reported that female investors outperformed male investors by 55 percent in the past nine years. Another is our income. Studies show that women still earn 76 cents for every dollar that a man earns. This is one of the reasons women start their own businesses two times the rate that men do. Another scary statistic is that 55% of women over 65 are widows and their income is $9,366.00 a year! So, to sum it up we have a lot going against us, but we are smarter investors.  

2. Have A Cushion

Any financial coach/advisor/research online is going to tell you that you want a minimum of 3 months worth of income set aside for emergencies. This is for if you lose your job, car accident, medical emergencies, etc. Focus on where you are at financially and if you lost your income how long you could live off your savings. The main focus point is to make sure that your money is working hard enough for you. It is important to have the money in an account that earns interest. If you have your liquid money in a checking account or underneath your mattress it is earning no interest. Money that is liquid is immediately accessible to you such as in a checking or savings account. But, ideally in an insured money market account - some place where you can earn the most interest on your money but still keeping it liquid.

3. Know One Rule

The Rule of 72 is a simple formula that helps you understand how fast money grows and how assets appreciate. If you divide 72 by the interest rate that you are earning on your money, you will find out how many years it takes for your money to double. For example, if over the last seventy years the stock market produced an average return of 10.4%, you round that down to 10% and plug it into the formula, and you will find that your money should be doubling every 7.2 years. The Rule of 72 is a mathematical concept and is not a guarantee of investment performance or a predictor of investment results. It is simply an approximation of the impact a targeted rate of return would have. There is no assurance an investment will double in value.

4. Save Money Monthly and Buy SMART Assets

The more money you can set up in an automatic investment program the easier it may be to save. If you are like me and when you have money in your purse, you may spend it. With automatic investment programs, you are able to save as little as $25 a week or month and have the money come directly out of a checking or savings account. The goal is to buy things that produce income. That is the whole goal. The goal is that you accumulate enough assets so that you do not have to go to work and take your time to earn your money. The goal is that you accumulate enough assets that you can live off of them. Examples of these assets include businesses, rental property, stocks, and most bonds. Consider buying assets that are expected to produce cash flow, but do not require daily management. This can help you attempt to build and preserve your wealth. 

5. Know Your Money

 Money is simply a vehicle to get you to where you want to go. Take control of your vehicle and control your path and destination. The one thing women are great at is relationships. Your relationship with money is important. One of the things you can do to feel more in control of your money is to take time to attend seminars on money and investing. Learn what assets are and how they work. Use this educational time to then relate it to your own financial situation. 

Know the three basic types of investments: stocks, bonds, and cash. 

What is a stock? A stock is a share of ownership in a corporation.
What is a bond? Think of a bond like a loan. You take your money, loan it out to someone and in a number of years you will get your money back plus interest. What is cash? Cash is liquid money. Cash is your money in a money market, savings account, and in your purse.

6. Happiness in Retirement

The first step in saving for retirement is to answer these two questions.

• At what age do you want to retire?
• How much income do you want when you retire?

If you can tell me how much you have saved up so far and the answer to these two questions, I can tell you if you are on track towards retirement. Or if you are not on track. And if not on track, I can tell you how much you need to save every month to get on track. There are a number of different vehicles that you can use to save for retirement such as 401K, IRA, Superannuation, Pension, ISA

7. Investing Makes Sense

When it comes to investing we need to find balance. The balance can come by spreading risk over time. There are many different types of things to invest in such as stocks, bonds, mutual funds, exchange traded funds, structured CD's, and so many more types of investments. Either seek out a financial advice/research online for they can help you to have investing make sense.

8. Helping Kids

How to help your kids be happy with money is by talking about your values and what is important to you about your money. I encourage you to give yourself and your kids an allowance. I also recommend setting up a family fund. With a family fund, you as a family come up with a goal for your money; as a parent, you can offer a matching program. The goal could be a trip or a new toy. So, for example, if your daughter puts in $1.00 to the family fund, you could match her 50 cents. This way she can learn about finance so that when she starts her first job she understands the concept of money and investing. There are many options available for saving for kids for college such as a 529 Plan and IRA.


9. Plan For Your Estate

Estate planning is a topic that sometimes people do not like to talk about. Who likes to plan for their death? Estate planning can be crucial unless your plan is to die broke. I encourage you to set up a will or trust. The woman that is organized, and truly wealthy plans for when she will no longer be around. 

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you. Stock investing involves risk including loss of principal. Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

Article Source: https://EzineArticles.com/expert/Nicole_N_Middendorf/1358640