**I partnered with SheSpeaks/Prudential on this post, all opinions are my own.
Ten years ago, my financial future consisted of shopping for trendy clothes and splurging on weekend excursions. Fast forward a decade later and my financial future includes children and concepts like investments, retirement, and college. Upon getting married and purchasing a home, I knew my husband and my financial future was something that needed to be laid out sooner than later. More importantly, it needed to be something that I not only understood, but maintained control in. The key to paving a path for your financial future starts with taking that first step. Luckily, you don’t have to do it alone, a Prudential advisor can help get you started on your journey to own your future!
My financial future journey started when I was hired by my first corporate company, but it didn’t happen right away. I was hired by a company that offered benefit packages which included a 401K retirement plan and investment options. As a young woman new to corporate, I wasn’t thinking about my retirement, I wanted to bring home as much money as possible. Shortly after starting my position, I met with an advisor and learned exactly what a 401K meant and how it could benefit me in the future. I immediately enrolled and started saving for my retirement. It seemed the majority of my friends (especially my female friends) weren’t participating in any type of retirement plan or taking any steps towards their financial future at that time.
The next big step in my financial future was when my oldest son was born. At that time, I realized my husband and I now had the added responsibility of my son’s financial future. We immediately started researching life insurance options. The fact that I had my license in health and life insurance definitely helped to understand the type of policy that best fit our needs and desires. If you are unsure about the different options available and what is best for your situation, it’s always a great idea to work with a financial advisor who can help you through the process!
My accident was a huge trigger for making sure I was taking the appropriate steps for my financial future. Going from working in a full time corporate position to being a brain injured and staying at home mom meant I could no longer aggressively invest in my retirement plan. I had to think of different and creative ways to ensure our financial future path wasn’t altered extensively due to my disability. Plus, I needed to take into consideration the other financial obligations in our future now that we had three children.
Maintaining financial security isn’t something many women talk about, but it is so important! Prudential identified four key insights that challenge women’s financial security.
1) Wage and Income Gap:
- The average woman working full-time earns 79% of the income earned by her male counterpart.1 This is because of many issues – lower likelihood to negotiate salaries, time out of the workforce, differences in pay.
- The wage gap not only impacts women’s 401K balances over their lifetime but it also impacts their social security payments. Predictably women’s social security benefits are 27% lower than that of their male counterparts.2
2) Investment Gap: Women don’t invest to the same degree as men. 3 Women’s discomfort with investing comes at a high cost for them: They are apt to delay investing, invest more in lower risk, lower return investments and are more likely to run out of money in retirement.
3) Women Are Living Longer and Living Alone: Women outlive men by an average of 5-6 years. 4 Are they prepared financially for these years?
4) Time Gap: On average, women in the U.S. spend 28 hours per week on household chores – 65 percent more than the average for men.5 That is uncompensated work and it does not figure into women’s financial planning. Prudential has created a tool called the “Value of all you do” that lets you very quickly quantify the value of all the household chores you do on a daily basis. What you would need to pay someone to do those for you.
At this stage in my life, the time gap is my biggest financial challenge. I was able to quickly use The Value of All You Do tool to calculate if our current life insurance is appropriate. But my financial future is more than retirement. My financial future includes a dream family vacation to an island, purchasing a new home, and helping our kids pay for college and with their first cars! If you haven’t taken the steps to own your financial future, its not too late to start your research and work with a Prudential advisor to start you on your journey!
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- Source: U.S. Census Bureau, Historical Income Tables Table P-40: Women’s Earnings as a Percentage of Men’s Earnings by Race and Hispanic Origin, 2016
- Source: Social Security Administration, Fast Facts and Figures About Social Security, 2016
- Source: http://fortune.com/2016/05/11/sallie-krawcheck-ellevest-launch;
- Source: Prudential Retirement analysis; National Center for Health Statistics, Health, United States, 2015: With Special Feature on Racial and Ethnic Health Disparities. Hyattsville, MD. 2016
- Source: Organization for Economic Cooperation and Development, October 2016, http://stats.oecd.org/index.aspx?queryid=54757