Smart Women Smart Money | Harris & Harris Wealth Management

I was talking to a friend about retirement and what that would look like. I envision a life where I am volunteering, traveling, and spending time with family and friends. I’m sure many of you have done the same, pictured your life in your golden years.

I read an article in USA Today recently, and I was overwhelmed with emotion. The article featured the stories of several women of retirement age, but they are living lives that I would venture to say they never expected. One woman had retired and had been working a part-time job to give her extra income. But when the economy crashed, she lost her job and hasn’t been able to find another. The second woman can’t afford to retire. She is financially supporting a household comprised of her grandchildren and her mother, who has Alzheimer’s. They are not enjoying their retirement; it seems they are just living through it.

Then I saw an interview between Oprah and Paula Deen. I was so surprised to hear that despite the success Ms. Dean has enjoyed and the sizable “nest egg” she has amassed, she still has a recurring dream that she will end up penniless. At that moment, I was reminded again of the overwhelming fear so many women have surrounding their finances. Ms. Dean also shared how she hoped her success would leave a legacy so her children would not have to live a life without. (Of course, I am paraphrasing, but that’s the gist of it.) I believe at the end of the day, their financial situation is one of the most important things to women with families.

According to Alexandra Penney, author of The Bag Lady Papers: The Priceless Experience of Losing It All, many successful women have that same fear of losing it all and becoming homeless. With all the reports about women and finance or women and retirement, over and over again you hear the same fears. “Am I going to have enough to live the lifestyle I desire?” “Will I be able to retire when I want?” “How long will my money last?” “How do I factor in rising health care costs?”

Yet amid all these fears, women will inherit approximately $28.7 trillion in assets as a result of generational wealth transfers.[1] Others will accumulate wealth through their own professional accomplishments.[2] Women also make approximately 80 percent of family household buying decisions, including those related to banking and financial services.[3]

So what do you do? Plan, plan, plan. It starts there. No plan is bullet-proof, but it helps to sit down and discuss things with a professional, someone you feel you can trust. Explain where you are now and where you are trying to go. Describe how you see your life after the 9–5. Discuss your current cash flow – which is your income minus your expenses – and any major changes you expect to occur by the time you want to retire. Ask questions. Participating in the process will help develop confidence in where you are going financially. Always stay engaged and meet regularly with your planner.

Look, we juggle careers, kids, partners, and parents. We can handle this. We can plan for our futures. Just make it part of your “to do” list, the first item. Face it instead of running or hiding from it. That is, if you still want to cruise through retirement in your special style enjoying life and the next pair of shoes.

[1] J. Havens and P. Schervish, “Why the $41 Trillion Wealth Transfer Esti- mate Is Still Valid: A Review of Challenges and Questions,” Journal of Gift Planning, vol. 7, no. 1, January 2003, pp. 11–15, 47–50.

[2] H. Pordeli and P. Wynkoop, The Economic Impact of Women-Owned Busi- nesses in the United States, Research Report, Center for Women’s Business Research, McLean, VA, October 2009; and Key Facts About Women-Owned Businesses (2008–2009), http://www.womensbusinessresearchcenter.org/ research/keyfacts/.

[3] B. Brennan, Why She Buys: The New Strategy for Reaching the World’s Most Powerful Consumers, New York: Crown Business, 2009, p. 4.