Women need to take special care when it comes to their finances. A couple of common facts about women and their financial health may influence your future.
Because of this, here are a few tips to consider about your financial future:
Proactively save for your retirement
On average, women stay home 12 years with children instead of working outside the home. So they are less likely to participate in a company-sponsored retirement plan. Stay-at-home moms can, however, participate in a spousal IRA, which can be established either as a traditional or a Roth IRA.
If saving is difficult, take advantage of PIPs
Society pressures us to spend, not save. Consider setting up a periodic investment plan (PIP). A PIP is an automatic purchase plan, usually of a mutual fund. Once you do the paperwork, money is deducted automatically from your account.
Learn the basics about financial management and investing. Take a class through a reputable source where the instructor is not going to try to sell you products. Look to your local community education or college. Read books.
Don't passively delegate the investment of your money to someone else. Ask questions and expect to understand the responses. Don't be intimidated by jargon. Ask them to explain their response to you differently, and to your satisfaction.
Have a trusted professional
The key word is trusted. Do your due diligence. Ask other women for recommendations. Look for a qualified individual. Professionals in the field of financial planning usually will have the Certified Financial PlannerTM designation (CFP®), although many other reputable designations are out there. Interview several professionals to get a sense of who speaks your language and whom you are comfortable with.