Actively Navigating Your Financial Future

Why do more women than men face this kind of economic adversity? Aside from broad institutional inequalities, such as the pay gap, reasons vary.

Reason 1: Division of Household Oversight

Often, one person in a relationship is the primary manager of a household’s day-to-day and longterm finances. This may be based on expertise, preference, available time or gender dynamics, but there is typically an implicit trust that a life partner will establish the best plan for the couple or family. Real-life cases show, however, that this can lead to passivity and one spouse being left out of the financial conversation. The more complex the estate, the greater the information isolation may be over time for the partner who is less active in its oversight.

Reason 2: Investment Styles & Confidence

Women statistically take fewer investment risks than men. Additionally, women give themselves lower scores on financial literacy self-assessments than men do, and women over 50 especially demonstrate less knowledge about investment principles.¹

At First County Bank, our advisors have witnessed how monetary uncertainty disproportionately makes a challenging personal situation even more difficult for women when an unexpected life event occurs. Women, more often than men, find themselves needing more self-generated income than they anticipated, and are often unable to locate critical documents, unsure of who to contact for information, uncertain of the details of their estate plan and, perhaps, facing untenable economic futures.

• 26% of widows had difficulty locating bank accounts and investments and obtaining access after their husbands died²
• Divorced spouses, on average, need more than an estimated 30% increase in their income to maintain the same standard of living³
• Despite being generally conscientious about saving for retirement, especially through workplace 401Ks, women are often not maximizing their estate growth through investing⁴

To feel in control and secure, female or male, it is important to be engaged before a time of change or crisis. There are many ways to enhance your general and personal financial awareness:

• Be an active partner in all joint financial and estate planning decisions, especially if a primary asset and income generator is a closely held business
• Insist your financial advisors are willing to engage, respect and educate you – even if you are not the primary contact
• Regularly review your credit rating
• Know how to contact all current legal and financial advisors
• Maintain updated lists of account numbers and passwords for cash and investments
• Review your tax returns and all estate documents before you sign them
• Ensure you know your total net worth including all assets and debts
• Educate yourself on the basics of investing and estate planning; start with National Endowment for Financial Education (NEFE.org) and The Women’s Institute for a Secure Retirement (WiserWomen.org)

Should you find yourself navigating through the complexities of a change in life and/or financial status, consider this advice:

• Take the time to assess your situation now and for retirement before making any major financial decisions
• Understand everything you can about the access to, and tax implications of, your individual and joint assets
• Think about your personal and professional relationships, and seek support and advocacy from those you can trust to help you make and execute the best decisions for you and the next generations
• Enlist the services of a professional financial advisor who is experienced, compassionate and with whom you feel comfortable