SLA Financial Articles

     Many women have not been well educated in money management. They have been sheltered and left out of the process by fathers and husbands who have provided for them. This has led to a dangerous precipice for women because statistics show that most women will be alone during some phase of their lives. They can be divorced, widowed or just single by choice.
     Women have a disadvantage over their male counterparts because they tend to be in and out of the work force. They often take years off from their careers to raise their children or to take care of elderly parents. Although progress has been made furthering compensation of women, they still trail in this area to a significant degree. When they make less money during their economically productive years and those years are fewer, they qualify for less in Social Security benefits, have smaller pensions and it is, therefore, harder to put money aside for their own retirement. Statistics from the Department of Labor relate that two-thirds of working women are in jobs with the lowest pension coverage rates and approximately half work in small companies much less likely to offer pension plans.

     In addition, women have a longer life expectancy than men and will, therefore, have to provide for them- selves for a longer time. Women also tend to be scared of risk when it comes to investing their money. They think of money as security and their biggest fear is that there will not be enough to support them when they are older. They want bank safety for their investments but expect their money to work for them. This creates a dilemma. When women want to play it really

safe with their investments, they will not get the growth and inflation hedge they need to make their money grow. It is no wonder that Department of Labor statistics show that elderly women are twice as likely as elderly men to be living in poverty. The problem is very real and very frightening.
The question is: what do women do about this? Can we depend on the gov- ernment and the Social Security System to take care of us? The financial security of the Social Security System is questionable because of the current demographics of the aging population in the United States. This system was never meant to provide for all retirement needs and the percentage of what it currently covers for the average retiree is less than 20 percent. The government is slowly recognizing the problem and Congress has passed legislation aimed at raising pension security by broadening coverage in small businesses, services, retail operations, schools, hospitals and social service agencies i.e. sectors of the economy that employ many women. By and large, however, businesses are putting most of the responsibility for retirement on the individual. Much of the money saved for retirement now comes directly from the employee's salary and it is the employee who must make the investment choices and bear the risks associated with those choices.
There is no magical answer to this problem but there is a solution. The answer to this problem is education. Women have to find ways of budgeting and deferring spending now so that there will be adequate resources for later years.

   · We have to know the tax ramifications of our financial decisions. When we buy a house or make other major purchases we need to take maximum advantage of the tax break offered
   · We have to know what the risks to our wealth are and how to protect wealth from risk.
   · We have to understand inflation and the way that it ravages purchasing power over time.
   · We have to set finite goals for our selves and find the willpower to achieve those financial goals.
   · We have to learn to diversify and invest our assets wisely so that they will grow for our future.
   · We have to have the sheer fort itude and determination to approach all of this. For many women it is so intimidating that they are paralyzed and unable to act.
   · Finally, women need to understand that finances are not something that only men should control or under stand. Even if there is a husband or significant other in her Life, a woman should be as cog- nizant of her financial life as her pattner.   Nobody is more interrested in your financial future than you.
   The best tip I can give is not what stock or mutual fund is hot. Rather, do not make any financial decision in a vacuum. Each decision you make will impact on another financial area. Financial planning need not be thought of as rocket science. If you put the time and effort into understanding your financial situation and goals, organizing your life around your financial plan and getting the right guidance when you need it, financial security becomes an attainable goal.