Everybody’s financial future depends on how well they prepare for retirement, but women may find it particularly difficult.
Women have longer lifespans than men, and they are more likely to take professional interruptions to raise children or care for aging parents, which can result in lower earning potential and Social Security benefits. In order to have the money and resources necessary during retirement, it is crucial for women to prepare ahead of time.
Here are some time-tested, women-focused retirement planning ideas:
Educate Yourself
When it comes to mapping out retirement, information is essential. Women should educate themselves on the fundamentals of personal finance, such as setting up a budget, making investments, and saving money. Women who understand these basic ideas will be better equipped to plan their future. Fortunately, there are a lot of tools out there to assist women in getting started, such as websites and online blogs. An experienced advisor can also give women valuable information and counsel.
Prioritize Saving
Regardless of their income level, women should prioritize saving. The secret is to start early and save regularly. Women can lay a solid foundation for their future by saving a small amount of their monthly pay. As a general rule, try to set aside at least 20% of your income. Women who prioritize saving can create a safety net for unforeseen events and strive toward long-term objectives like property or retirement.
Invest for the Long-Term
Investing is an important part of financial planning, as it can help women grow their wealth over time. However, it is important to approach investing with a long-term mindset. Rather than trying to get rich quickly, women should focus on building a diversified portfolio that can withstand market volatility. It’s time in the market, not timing the market.
Protect Yourself with Insurance
Another essential component is insurance. Women should consider purchasing health, life and disability insurance to protect themselves and their families in the event of an emergency, or even death. Additionally, women should consider long-term care insurance to cover the costs of potential medical expenses in retirement.
Diversify Your Portfolio
Women should plan for long-term success by diversifying their holdings across markets and asset classes rather than concentrating on just one type of investment. Consider including a range of assets in your portfolio mix, such as stocks, bonds, mutual funds, and other financial instruments, depending on your personal risk tolerance and investment objectives. Diversification may improve your potential returns, stabilize your results and reduce the overall risk of your portfolio.
Consider Opportunities for Self-Employment and Passive Income
Along with the traditional retirement savings, consider alternatives for passive income and self-employment. Starting a small business, buying rental property, or using assets to establish a passive income source are all examples. Your retirement savings can be supplemented by these sources of income, giving you more security throughout your golden years.
Get Professional Help
An advisor can create a retirement plan that meets their needs and goals. It’s a good idea to choose someone who specializes in preparing for the future and can provide expertise in choosing the right investments tailored toward your risk tolerance and time horizon.
Take the time to plan ahead for a stable financial future and rewarding retirement!
At Independent Financial Services we have professionals who can guide investment strategies, offer tax-efficient savings options, and assist with retirement planning. By working with one of our professionals, women can feel confident they are making informed decisions.
Get in touch with us today to get started.