Home' Trinidad and Tobago Guardian : June 22nd 2014 Contents The modern woman is well educated and
more likely to be a key financial con-
tributor, if not the main breadwinner,
for her family than in previous decades.
However, despite earning more money and controlling
more wealth, many women fail to adequately save for
retirement. A recent study by Transamerica Center for
Retirement Studies found that only 29 per cent of
women made saving for retirement a priority in their
Intellectually, women know that it makes good finan-
cial sense to invest in their future. So what gets in the
Often, the emotional side of money inhibits women
from taking proactive steps to save for retirement. Here
are five emotional roadblocks that can put a crimp in
Practicing an "everyone comes first" philosophy:
Women are socialised and hardwired to take
care of others and often put their family s needs
before their own. This results in many women signif-
icantly underfunding their retirement accounts, as they
are preoccupied with paying for their children s college
educations, their elderly parents day care or their part-
ners expensive hobbies.
It is not easy to say no to the ones you love, but keep
in mind that there are student loans and insurance
plans to cover, respectively, college and health-care
costs. There are no retirement loans. It is up to you to
prioritise this area of your financial life. It does not have
to be all or nothing. Simply put your needs in the mix
with those of the kids, your partner and parents.
Believing the myth that "A man is the plan":
In the 1950s, the best way for a woman to
acquire wealth was to marry a rich man. This
is no longer true. Four out 10 women are the primary
breadwinners for their families, and women are creating
wealth in their own right, author Liza Mundy reports
in her book, "The Richer Sex: How the New Majority
of Female Breadwinners Is Transforming Sex, Love and
Despite these advances, some women still rely on
meeting Mr Right as a retirement strategy.
Keep in mind that you may meet Mr. Right, but he
may come with debt or decide to divorce you just as
he enters his pre-retirement years. The sad truth is that
a woman s income usually drops by 40 per cent post-
divorce, whereas a man s declines by 25 per cent, accord-
ing to "Family and Retirement: The Elephant in the
Room," a study from Merrill Lynch Wealth Manage-
The best strategy is to be financially responsible for
your own retirement and proactive in funding that
account, married or single. This way, if you find a rela-
tionship that is fulfilling and dreamy, you can enjoy it
and not have to worry about relying on a man as your
Getting sidetracked and sandwiched in:
According to Family Caregiver Alliance, women
are more likely than men to take time off from
work to care for children and elderly parents. In addition,
female caregivers spend as much as 50 per cent more
time providing care than their male counterparts.
Whether it is a small child or an ill parent, this time
away from work decreases a woman s earnings and
derails retirement savings.
There are no easy answers, as people are living longer
and health-care costs are increasing annually. However,
the best strategy is to be proactive and consider your
options before quitting your job to care for others.
When it comes to children, take time to look for a
solution that is best for the family but also for you and
your future financial picture.
Talk to your elderly parents, preferably before they
become ill, and encourage them to sign up for long-
term care insurance to help cover some of their antic-
ipated health-care expenses, should they end up needing
Lacking financial confidence: Only 7.0 per
cent of women are "very confident" in their
ability to fully retire and live comfortably,
according to the Transamerica Center retirement study.
This lack of confidence permeates other areas of women s
financial lives, too, and results in 49 per cent of women
staying awake at night worrying about becoming home-
less and destitute in their old age, according to a study
from Allianz called "Women, Money and Power Study:
Empowered and Underserved."
The dilemma is that this worry does not always moti-
vate women to increase their financial literacy. Without
a good understanding of basic saving and investment
strategies, it is challenging to adequately save for retire-
Of course, there are solutions for these women. It s
essential to make time to learn more about your finances.
Find a financial advisor who is good with women and
is willing to teach you the basics of good money man-
agement and investing. Finance may never be your pas-
sion, but similar to learning about good nutrition, know-
ing how to confidently invest for retirement is part of
being a responsible adult.
Not controlling spending habits: The pressure
on women to look beautiful and fashionable
is strong in our society and costs women
millions of dollars. The fashion industry is a multi-
billion-dollar business, and many women invest more
in looking good than in their pension plans.
InStyle magazine reported that the average woman
spends US$100,000 on makeup during her lifetime.
Just imagine if a woman who just turned 21 put that
exact amount into a retirement account earning 5 per
cent annually. If she kept the money in the account
until she was 65, she would have saved in excess of
$800,000---without adding a cent.
Most women want to wear makeup, but the real
question is about how much you need to spend to
look good. If you are spending big bucks on beauty
products and clothing, take a moment to think about
how these expenditures might impact your financial
security in the long run.
"Make sure you understand the emotional road-
blocks in your way when it comes to planning for
retirement, and work diligently to remove them."
To cut down on overspending and keep long-term
savings goals in mind, attach a picture of your ideal
retirement location or activity to your credit card.
Enlist the support of a financial adviser to support
you in reaching your savings goals, and just say no
to that new, expensive leather handbag.
Being a woman in today s world is both exciting
and complicated. Make sure you understand the emo-
tional roadblocks in your way when it comes to plan-
ning for retirement, and work diligently to remove
SBG18 | INVESTMENT
SUNDAY BUSINESS GUARDIAN www.guardian.co.tt JUNE 22 • 2014
Ways to prepare
Being financially secure in retire-
ment just doesn't happen magically.
It takes lots of planning, time and
Some scary facts about retire-
• More than 50 per cent of indi-
viduals do not have enough fi-
nances for retirement.
• 25 per cent do not participate
in their company's retirement plan.
• The average person spends 20
years in retirement.
Here are some tips to help you
1) Talk to a financial professional.
Every few years, it's a good idea to
schedule a meeting with a financial
planner to get a check-up. It's just
like a doctor's visit, and you should
really talk about your present situa-
tion and future goals.
2) Save, save, and keep on saving.
Make it a habit to save as much as
3) Learn your retirement needs.
Retirement can be expensive. Learn
from today how much you need to
save for your retirement. Talk to a
financial planner, or find an online
4) Take part in your employer's
retirement plans. If your company
offers one, it is usually the best tool
you can use. Talk to a financial pro-
fessional for all your options.
5) Learn about pension plans. If
you have an employer or govern-
ment pension plan, learn all the de-
6) Keep your retirement savings
off-limits. Don't make a withdrawal
until you retire, you might incur
penalties and it will be a setback
for realising your goals.
7) Get your employer to start a
plan. If your present job doesn't
offer a retirement plan, ask for one
to be started. Many times it isn't a
cost to your employer to start one,
and it can help you tremendously.
8) Learn about your govern-
ment's retirement plans. Every
country has different plans some
with special tax incentives, so learn
what your country offers and plan
9) Do your own research. Use the
Internet, read the newspapers and
magazines, talk to your friends, to
find out as much as you can about
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