Top 5 Financial Fears That Affect Women
Financial fears can paralyze anyone from making a decision about money. For many women, money matters are particularly terrifying. According to a GOBankingRates study, 47% more women than men name “living paycheck to paycheck” as their number one financial fear.
So, why all the fear? What's holding females back? Here are five of the most common fears women have when it comes to money and ways to overcome them.
1. Financial Professionals Won't Take Them Seriously
Women have made great strides in business and earning power over the last 50 years. Katie sowers recently became the first female to coach in the Superbowl as the 49ers took on the Chiefs. Despite this, many women still see investing as an industry geared towards men. This can leave women feeling intimidated. They may have concerns about how financial professionals will treat them. These fears are often justified.
Steps to Overcome: Women can empower themselves by learning more about finances. Finding an advisor with the heart of a teacher can be an invaluable resource.
2. Running Out of Money
Many people are afraid of outliving retirement savings. Women find it a much more pressing concern. Why? Women tend to outlive men by as much as five years. This means women, on average, will need almost a fifth more in their nest eggs than men. Women also earn less on average than their male counterparts. This means they may have to build larger nest eggs on less income.
Steps to Overcome: Instead of thinking you have to work until you drop, women could consider a "Pre-tirement". Start thinking of ways to earn income while dialing back the corporate obligations. Consulting or turning a hobby into a business are two great ways to earn some income without the stress level of a 9-5 job.
3. Prematurely Losing a Spouse
The death of a husband can have severe financial repercussions for many women. This is particularly true for women whose husbands were the primary earner in the family. Often times investments and financial plans are "taken care of" by the husband. This can leave a recently widowed wife in the dark about her financial future.
Steps to Overcome: It's a good idea for both spouses to understand and be comfortable with all financial plans and investment accounts. If using a financial advisor, insist on being present for reviews. It's also important to have enough life insurance in place. This can help bridge the gap formed by a loss of income.
4. Losing a Home
It is hard for anyone to imagine losing their home. It may be smart to have a plan to become mortgage-free as soon as possible. With today's low rates, you may earn more by investing the extra cash flow, but that doesn't come with the same peace of mind. Also, keep in mind that things like taxes and insurance don't go away when you pay your mortgage off.
Steps to Overcome: Make sure you have a line item in your retirement budget for maintenance, insurance, and taxes. Determine if you will need to downsize and at what point. Make sure you have funds to up-fit your house so that you can age in place as long as possible.
5. Having to Pay For Your Kids Forever/ Being a burden
Ok, this is technically two different fears but they often tie into each other. Having children is expensive, but being a great mom doesn't mean paying the kids' bills forever. As nurturers, tough love is often more difficult for Moms. Also, any dollar that goes to them, doesn't go to your retirement fund. You want to take care of your kids but you don't want to end up having to rely on them to take care of you financially.
Steps to Overcome: Start educating your children about money as early as possible! Setting boundaries for adult children is healthy, and in the long run, the right choice for everyone. Invite them to a review meeting with your advisor. This will help them understand what your trying to accomplish and their role in the equation.
Finances can be scary. You may have different fears then the ones listed above. A surefire way to ease money fears is by developing a plan with a trusted advisor. One who understands your fears and will help to educate and empower you to overcome them.
Would you like to talk with someone about your money fears? Schedule a no-obligation, no-cost 15 minute phone call today.
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.