As a bevy of financial products targeting women continue to hit the market, it’s becoming increasingly clear that more women need to be involved in planning for their financial futures.
While women are increasingly involving themselves in saving and investing money, a large gap remains between women and men when it comes to planning for retirement. A 2016 study from the National Institute on Retirement Security showed that women in retirement have substantially less income than men - a roughly 25% wage gap that mirrors the pay gap. (According to the Department of Labor, just 44% of women participate in their employer’s retirement plan.)
Research shows women should be involved in retirement planning not only because they live longer than their male partners, but also because they often take time off of work after having children, which can hinder opportunities to save for life after work.
Many women, however, leave the financial planning up to their male partners, presuming that he will handle their finances better, Kristen Euretig, founder of Brooklyn Plans, a financial planning service that targets women, said. But why? “Research shows that women have a confidence gap when compared to men in terms of managing their money,” Euretig said.
Indeed, a recent Bank of America Merrill Lynch report showed that 55% of women feel they know less about the financial markets than the average investor, while just 27% of men felt that way. Some theorize that this is because women tend to have less confidence than men professionally, but it’s still unknown why women feel they know less about financial markets specifically.
In recent years, financial companies geared towards women have started to enter the market, such as Ellevest, Learnvest and Find Joy, among others. And for women looking to get more involved, Euretig suggests they should start by attending events held by the local YMCA, credit union or financial advisors.
Women should also start to talk to their partners about what’s happening and what’s involved. Her partner may have wanted some help in the financial planning all along.