Who are the Most Confident Women Investors? |
![]() Theodore Massaro, CLU, AEP, Chartered Financial ConsultantMr. Massaro has been involved in the areas of financial planning and employee benefits since 1974 when he began his career as an agent. In 1982 he co-founded M Financial Planning Services, Inc. and simultaneously established Asset Management Associates of Medford Inc*. M Financial Planning Services Inc. is an independent financial planning and advisory firm serving individuals and business across the United States. Over the years Ted has had the good fortune to establish long standing relationships over 20 years on average with many of his clients. |
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The study* found that attitudes about investing differed among marital demographics, especially in the case of widows. Widowed women have more confidence when it came to managing their money, with nearly 65% of widowed respondents giving themselves a rating of 8 or better on a scale of 1-10 when asked how good of a job they are doing managing their money. This compares with nearly 40% of married and single women and 52% of divorced respondents who answered in the same way.
“It makes sense that women who are responsible for their own finances through a major life event such as widowhood or divorce have more confidence in their money management skills,” said Lauren Coulston, Assistant Vice President, Oppenheimer Funds. “One possible reason for this confidence could be because we see more widows working with financial advisors. Widowed women are often forced to deal with their own finances and appear to approach financial planning methodically. Often financial planning occurs in a time of crisis, but it doesn’t have to.”
“The fact is, 80-90% of women will be solely responsible for managing their own finances at some point of their life due to longer life expectancies and higher divorce rates,” said Coulston.
Following are a few tips that can help you get started.
Know what you have to work with.
Gather your bank statements, bills, investment and retirement accounts and figure out your net worth. What is your annual cash flow and how much are your total expenses? Knowing how much money you have is a critical first step to building a financial plan.
Work with a financial advisor.
Women should work with a financial advisor to come up with an objective, reality based plan to tell them where they are and where they are headed if they stay on the current course of saving and spending. Advisors can help women take a look at their unique implications, such as long life expectancy, the impact of inflation, potential issues associated with relying on a spouse’s pension or health benefits, the timing of Social Security and Medicare benefits, and the dangers of carrying too much debt.
Start Saving For Retirement Immediately.
It’s never too early or late to start saving for retirement. Enroll in a company sponsored retirement plan, Roth IRA, or other retirement savings vehicles and contribute the maximum.
Don’t Forget College Funding.
Delaying college savings can ultimately delay retirement. The cost of college is rising and 529 Plans are a great way to grow tax deferred income. Withdrawals for qualified educations expenses, which range from tuition to pizza money, are tax free.
Pay Yourself First.
While paying bills each month, write a check to your savings account. Although 10% of your earnings should ideally go to savings, even a small amount will add up over time. Our research shows that nearly half of respondents said if they knew that saving just $50 a month over several decades would provide them with more than $500,000 when they retired, they would be strongly persuaded to start saving for retirement.
Plan Ahead, Create a Will.
Due to longer life expectancies, most women outlive their husbands. While you can’t prepare yourself emotionally for the death of a family member, you can act now to help keep financial stability in the future. It’s important to create a will, a living will in case of sudden illness or injury, and include documentation regarding power of attorney.
Dump Your Debt.
The best strategy for cutting debt is to pay as much as you can on your high interest balances and pay less on those with lower rates. By paying more than the minimum payment due, you’ll end up paying much less interest because you’ll pay off your balance much sooner. Consolidate to one credit card and contact companies to negotiate a lower rate.
Change Your Spending Habits.
Don’t use credit cards to pay day-to-day living expenses. Plan all of your purchases ahead and don’t go to a store without a list. Also, wait until cash is available to buy big-ticket items so you are not acquiring more debt. Consider using cash for shopping instead.
Stick with it and diversify your investments.
A sound investment strategy designed by you and your advisor takes into account the inevitability of choppy financial markets. It can be difficult, but it’s important to stick with your plan during these times. Also, work with a financial advisor to make sure you understand the risk profile of your investment and that your portfolio is well diversified.
*Oppenheimer Funds Inc. 2007 Women & Investing Survey. Disclosure Information-Important-Please Review. Securities offered through LPL Financial, Member FINRA/SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations to any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. LPL Financial does not provide tax services. Please consult your tax advisor.
- By Theodore Massaro, CLU, AEP, Chartered Financial Consultant
- Business & Finance
- Published 05/8/2008



