The Feminine Face of Finance

In a 2005 report from the Center for Disease Control*, on average women live 5.3 years longer then men. Because of their longer life span, women have an even greater need than men to make the most of their retirement dollars

The single smartest thing a woman can do is to begin saving early and invest more aggressively. The earlier you begin, the less money that is needed overall because the funds have more time to grow.

Younger women also can realize advantages by purchasing life insurance early, because life insurance typically costs less at earlier ages. Life insurance can be an extremely beneficial tool for women of any age. Women who do not qualify for company-sponsored plans, due to career interruptions or short tenure with an employer, would do well to explore this option. In addition to providing benefits to survivors, the insured can sometimes borrow against a policy to realize dreams such as paying for a child's education or starting a business.**

Other steps women can take toward financial self-reliance might include:

• Establishing solid goals. Be it a dream home on a lake or a comfortable condo in the city, concrete objectives give you something tangible to strive for and make it easier to assign a price tag to goals.
• Assessing your financial position. Take a critical look at finances, especially with regard to life goals. Consider asking an objective outside advisor for help in calculating where you stand. Know what investments you have and how much they are worth.
• Maintain Good Credit. Credit card debt keeps many people from reaching their savings goals.
• Create a solid portfolio. Investors should start as soon as possible to research financial information and start saving. Even seemingly small amounts of saving can build future stability and eventual wealth.
• Insure your income. Health, auto, and renters or homeowners insurance are all necessities but also consider disability insurance. If you are the breadwinner of your household, think about what would happen if your income were not available.
• Contribute to other savings vehicles. If your company offers one, contribute to a 401(k) plan. Women temporarily away from the workforce should check into a spousal IRA. A non-working spouse can contribute up to $3,000 a year and deduct the amount from the family's taxable income. Also utilize saving strategies such as life insurance, savings accounts, CDs, bonds and annuities.
• Team up with an advisor you can trust. Seek opinions from many different people and remember that good financial advice requires time and patience to explore opportunities and build a level of understanding that leads to good decision-making.

For both women and men, it pays to create a clear vision of one's financial future, both in terms of a better-focused, less stressful today and a comfortable, more prosperous tomorrow.

*Center for Disease Control, February 28, 2005

Source: The Northwestern Mutual Life Insurance Company

Revised: 8/2005