All of us should have retirement planning as one of our most important goals. However, there are several reasons why women need to be more diligent than men when it comes to planning, whether married or single.
Valerie RumboughWomen typically live about seven years longer than men, obviously requiring more income requirements. In addition, women on average take about 12 years off from working to care for children, etc., and therefore have had fewer years to save for retirement.
Although great strides have been made, women still tend to make less money than men on average. These three factors can really put a strain on a woman who finds herself at retirement age, if proper planning has not been done. If you fit into this category, there are several things you can do to be ready for retirement.
The first thing to do is to gain a good understanding of the investments you have and how to maximize their returns. This can be done by consulting a financial planner, who can also help to determine your retirement income requirements, and map out a plan to meet them. Then, save, save, save.
If your company has a 401(k) plan, work toward placing the maximum allowable amount into that plan. In addition, you can also place money into an IRA. Your financial planner can help you determine what type of IRA will be best for you. Once you have a plan in place, be sure to monitor it frequently to make sure you are still on track.
A minor bump in the road that is left unchecked can turn out to be a major disaster. If you don’t work outside the home, talk with your spouse about his plans for saving to take care of both of you.
With proper planning, your goals can be reached, and you will be very happy you took the time now to take care of this.
– Rumbough, CPA, CFP, is chief operations officer with the Baptist Foundation of South Carolina. Contact her at 800-723-7242. In accordance with IRS Circular 230, any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.