By Joyce Reyes-Aguila
Despite knowing how imperative it is to be ready for the future, we often procrastinate or put it aside. Women, for example, realize the need to think about life after they retire. But like men, they tend to prioritize their responsibilities in the family and career goals before considering their post-professional lives.
“It could be because just thinking about retirement makes it scary,” opines Nicole Bernabe, financial advisor and unit manager at Sunlife of Canada Philippines, Inc. on why women tend to put their retirement needs last. Aside from women realizing that they will be older, the responsibilities that go with it may also dissuade them from preparing. “One reason is because they may be enjoying too much on things their salary can buy such as travels, food (eating out), going out with friends, make-up, etc.” Bernabe says that while women should reward themselves for their hard work, they should also be responsible and be disciplined about saving. Forbes.com contributor Richard Eisenberg in a column last year featured the results of the 17th Annual Transamerica Retirement Survey: A Compendium of Findings About American Workers which showed that compared to men, women are saving less for retirement. In his article, entitled “Women and Retirement: Saving Less, Worrying More,” only 56 percent of women are involved in monitoring and managing their retirement savings compared to 70 percent of men. Further, women in the survey prioritized “just getting by — covering basic living expenses.” Reassessing your retirement approach can help you strengthen your future (and can even allow you to retire earlier). Here are some reminders women should keep in mind:
- Prepare as early as possible.
How early should you plan your retirement? “The best time to think about it is when you land your first job or receive your first salary,” Bernabe advises. “Save a portion of your pay every month, and place it in instruments that earn higher than a savings account such as investments. As time goes by, this will generate a huge amount of money. This will be your passive income.” Always remember that starting to think about retirement earlier gives you the kind of retirement you deserve.
- Consider life events and priorities.
Women play a myriad of roles, and all these should be considered along with retirement plans, reminds the financial advisor. Breadwinners consider their family’s needs immediately after graduation. Some are fortunate to have their salaries all to themselves. Match your financial responsibilities with life events such as getting married, having children, and paying for their education, purchasing a house, starting a business, and other unforeseen events, says Bernabe.
- Do not depend on your partner entirely.
Should women think about retirement differently if their spouses or partners retire earlier, later, close to when they do? “If we were in the olden days, the husband’s retirement will affect everyone in the family,” the Sunlife of Canada Philippines, Inc. unit manager avers. “This is not the case now. Women should have their own retirement funds and work on them as early as when they get their job – regardless of their partner’s own timeline.” A woman should also be insured even before they meet their partners in life. “Their decision shouldn’t be influenced on whether their husband or partner is insured. It’ll be great if everyone in the family has a life insurance. This will ensure the survival of the family’s lifestyle in the unforeseen event of a demise.”
- Plan out your financial plan.
Ensure that your savings can cover everything you and your loved ones may need. Emergency funds should be commensurate to the total amount of a person’s monthly expense for three to six months. It will also be helpful to have life insurance for the whole family, most especially its breadwinners, says Bernabe. Study how investing in guaranteed returns and mutual funds can boost your savings by giving you higher rates.
- Never think you can save later.
Delaying one’s ability to save is a common mistake of some people. “It is more difficult to save when you’re older because of all the responsibilities that go hand-in-hand with maturity,” says Bernabe. “To get back on track will require a lot of discipline and sacrifice. Women can cut off some unnecessary expenses to ensure that they can make up for all the time they did not spend. Investing in higher-yielding instruments such as equities and stocks is one of the things they can do to bounce back again.”
- Contact a financial expert.
Enable a financial advisor to conduct a thorough financial needs analysis and advice you on the type of insurance and investments you can acquire. Bernabe (firstname.lastname@example.org. ph), who is part of the insurance firm that has been in the country for over 120 years, says that plans and costs are dependent on the needs of a person. Health protection, life insurance, and retirement coverage can start from P2,000 to P5,000 a month.