Retirement should be a time to relax and enjoy the fruits of your labor. However, retirement can be stressful for women due to gender differences after retirement. This gender gap in retirement savings is driven by several factors, including low salaries and increasing debt burdens that make saving difficult.
On average, women contribute 43% less to their workplace retirement plans. This has a huge impact on their savings and ultimately leads to a less than optimistic retirement outlook. Thankfully, financial expert Suze Orman has provided some tips on how women can increase their financial security in retirement.
1. Embrace who you are and what you are worth
Suze Orman advises women to take care of themselves, their skills and their worth. For many women, the challenge of taking care of themselves and standing tall according to their worth is an ongoing battle.
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According to Orman, it’s important to recognize that if you don’t value yourself and your values, it will be difficult for others to appreciate them. To get rewarded for your true worth, you need to be confident and well-informed about your skills and what you bring.
Orman encourages women to stand tall and take pride in their work and in themselves. She says women are not for sale and should not be afraid to assert their worth.
2. The Gender Gap in Retirement Is Not Your Fault
It is also important to understand that the gender gap in retirement is not the fault of women. The problem is rooted in the wage gap between men and women and the institutional problem that women are more likely to take time off from work to care for family members.
It’s easy to feel overwhelmed and think you have to carry the burden of fixing everything yourself. Orman says women are not alone and there are many resources available to fill this gap.
Suze Oman advises women to stay informed, seek financial advice, and make wise choices about the things you can control. You may not have caused the problem, but how you choose to respond can make a big difference. By taking responsibility for the things you can control, you can move forward in solving the problem at hand.
3. Say “no” out of love, not “yes” out of fear
Generosity is an important value and many women find themselves caring for elderly family members and loved ones. Suze Orman advises women to say no out of love, not out of fear.
This means setting boundaries and being clear about what you can and cannot do. Not only will this help you manage your financial resources better, but it will also help you take care of your loved ones in a sustainable way.
Wherever possible, it would be fair for aging parents and relatives to contribute financially to the cost of caregiving and reduced income for caregivers. Similarly, siblings should contribute financially if possible.
You may feel uncomfortable asking for financial support, but you need to ensure your retirement security. Avoid staying silent on this issue to avoid increasing financial burden in the long run.
It’s also important to pause and think when your child asks for something that costs a lot of money. Instead of answering yes right away, ask yourself if you’re considering it out of fear that your child’s love depends on whether you give them what they want.
This idea may be common, but it’s incredibly harmful and wrong for everyone involved. Love should never be attached to money. When you turn down unnecessary high spending out of love for your children, you’re not only setting the right monetary value for your children, but you’re giving yourself more money toward retirement savings. By doing both, you show genuine love and respect for your child and yourself.
4. Take Advantage of Your Workplace’s Retirement Plan
Take advantage of a workplace retirement plan such as a 401(k). Suze Orman advises women to contribute as much as possible to these plans, as they have significant tax benefits and employers often contribute as much. If your employer does not provide a retirement plan, open your own IRA instead. Orman also recommends having multiple retirement accounts.
By continuing to contribute and leveraging employer matching, women can build a solid foundation for retirement. It’s never too late to start planning for retirement and taking steps toward financial security in the future.
Orman says women can take steps to narrow the gap by increasing their retirement savings. She advises women to contribute at least 10% to 15% of their income to retirement plans.
By valuing themselves and their worth, and by focusing on financial security, women can protect themselves in their post-retirement security. Ultimately, by recognizing their worth and standing up for it, they not only benefit themselves, but also create barriers that prevent other women from getting the recognition, respect, and reward they deserve. It will also help break down the Everyone deserves retirement security, and with the right mindset and guidance, it’s achievable.
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