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Women and Retirement | From the desk of Matthew Haertzen

I know many people who are excited that we now have our first female Vice President of the United States. Congratulations, Vice President Harris! Women continue to make great strides in not only getting elected to political office but also in securing leadership positions in business. Studies have shown that companies with higher female participation at the Board level or in top management positions generate higher returns, valuations, and payout ratios.1 I think we are all hopeful that this new diversity in our government translates to a more effective administration that ultimately benefits our country.

In that spirit, I would like to focus my article this month on women and retirement.

A recent Dave Ramsey article highlighted some of the unique challenges women face when it comes to retirement.2

  • Women tend to live longer than men. Consequently, women should plan to save more money for retirement than men. They should also be prepared to manage their finances alone.

  • Women are more likely to be caregivers. Caring for aging or infirm parents or family members can be both emotionally and financially burdensome, which can be a drain on retirement savings.

  • Women, on average, earn less, are more likely to work part-time jobs (without employer retirement plans) and spend less time in the workforce. This can also lead to lower retirement savings.

  • According to the Federal Reserve, women are less comfortable, on average, making retirement investment decisions than men.3
Despite the challenges, women can take steps to improve their financial situations and be prepared for retirement.

  • Make a plan. Take some time to reflect on your specific retirement goals. Where do you envision yourself retiring? What will you do? The more details you have about your vision for retirement, the more you will be prepared to do just that.

  • Get involved. This is my advice for both women and men. If you are to be fully prepared for retirement, you must be hands-on when it comes to your finances. Have a conversation with your partner about retirement goals and strategies. Understand where your accounts are and how to access them. I know it's tempting to let one partner take care of the finances, but you should both be knowledgeable about your financial situation and on the same page. If you do not have a partner, find a trusted person to talk with about your financial situation and decisions. My article on Financial Freedom discusses accountability partners.

  • Learn about investing and ask questions. As your financial advisor, I am happy to explain anything you might not understand. As you probably know, I am also a professor at the University of Arizona and have taught at colleges and universities for years. I am an educator at heart and truly enjoy answering clients' questions and helping people understand investing.
Retirement planning can be challenging for anyone. Regardless of your own particular challenges, I am happy to help you work through the process, develop a plan of action, and feel comfortable making informed decisions.

If you have questions or if you would like to discuss retirement planning with me, you can e-mail me at mhaertzen@wtwealthmanagement.com or call (520) 204-1058.

Sincerely,

Matt Haertzen
Matt Haertzen, CFA, CFP


References:

1 Press Release
Credit Suisse | September 9, 2014.

2 How Women Can Plan for Their Retirement Future
DaveRamsey.com | October 21, 2020.

3 Report on the Economic Well-Being of U.S. Households in 2018.
Board of Governors of the Federal Reserve System | May 2019.



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