Tuesday, March 8 marks International Women’s Day and putting some time and thought into your financial future is an important way to celebrate.
Although the basics of sound financial planning are absolutely the same no matter your gender, Canadian women face unique lifestyle and economic choices that require special consideration when it comes to their overall goals.
Here are just a few examples that have popped up recently during my meetings with Island Savings members:
- Women typically live longer than men. The latest data from Statistics Canada puts women’s life expectancy at 83.3 years while men tend to average 78.8 years. Most Canadian retirees live on about $2,400 a month—so this extra 54 months of life expectancy means that women need to have more than $130,000 more saved for retirement than their male counterparts.
- Women are brilliant multi-taskers. Although both genders face a pile of competing priorities every day, it’s typically women that plan for everything at once by balancing the goals of retirement planning with college funds, vacation savings, emergency fund rations and more. The ability to prioritize these competing goals well can have a major impact on the success of your long-term plan—especially now that women are typically the primary investment decision-makers in their households (and are quickly becoming the breadwinners).
- Women are usually the primary caregivers in Canadian households. Women’s social role as nurturers (at least by the books: 66% of current caregivers are women) can be costly in terms of earning potential outside of the home—as much as $325,000 in combined salary, social security and pension benefits. As women age, they often take on caregiving responsibilities for their elderly parents as well and their ability to absorb this loss in income requires a disciplined investment and savings plan that your financial advisor can help you build and manage.
- All women need to protect their wealth and legacy. Many women now marry in their 30s and 40s when they’ve already built up their career, net worth and major assets. As a result, consideration should be given to both pre-nuptial agreements and, at minimum, an updated will and power of attorney (especially if you have children). A will lets you identify legal guardians for your children and protect what you’re leaving them.
Whether you’re reading this at age 20 or 60, it’s never too late to focus on becoming financially independent and I believe that it’s important for all women to take ongoing measures to protect their current wealth, their retirement plans (which should include continued investing—you need to plan to fund at least 20 years of expenses) and their eventual legacy.
If you don’t already have a prioritized savings and investment plan in place, get started on one right away with your advisor so that you’ll be able to make it rain no matter what life throws your way.
Questions? Feel free to email me at firstname.lastname@example.org.