Why Women Need to Take an Active Role in their Family Finances

By Jessica Searcy Kmetty

There is a confidence “gap” when it comes to women taking charge of their finances, and the lack of confidence and action could leave women vulnerable in many situations.

Over half of American women say they have no idea where to begin when it comes to taking an active role in their financial decision making and only about 20% report feeling prepared to make wise financial decisions.

A wave of empowerment is running through mainstream media these days. Women are preaching to the younger generations to NOT let a partner control the financial decisions, not rely on a partner or parent for money, and to take an active role in the financial management of their family. With increasing lifespans, higher divorce rates and women not marrying as often, more than 80% of women may face being solely responsible for their own financial wellbeing.

Blindsided by Divorce

Almost half of the divorced women who come to us say that they didn’t have a good handle on their finances before their divorce. Many of them wish they would have been involved because not knowing what they had, where it was, or what it was worth left them feeling vulnerable in the divorce process. Some even say they have regrets about the divorce settlement and would have done things differently if they’d known the financial impact of some of the things they negotiated when they were ill-prepared.

Check your credit report regularly and know what is in your name. Both assets and debts carry responsibility.

Unprepared in Widowhood

On average, women live several years longer than men and marry partners who are a few to several years older, according to data from the Pew Research Center. The result is five to seven years of widowhood for a typical woman. Sometimes we meet a new client for the first time after her spouse dies. It often takes months to locate all the assets and figure out what the new widow will need to budget for her ongoing living expenses. Mind you, often all this work happens while she is still grieving the loss of her partner.

Choosing to Take Charge

Every now and then, a woman comes to us stating that she’s hiring us as her advisor because after doing some soul searching, one of her goals has become to take back control of her finances and her financial future. This usually means that she wants to learn how to be more in touch with what she makes, what she spends, what she saves, and how she uses money as a tool in her life to accomplish her dreams. This goal is all about empowerment and we love it!

Money doesn’t have to be scary, but you need to be willing to ask questions, seek answers, and find a person (or perhaps a small group of people) who understands financial matters and is (are) willing to discuss them in a meaningful way. Keep asking questions until you understand the subject matter. If an advisor or someone you’re confiding in is speaking over your head or using technical language that isn’t meaningful to you, let them know, or find someone else to speak with who is skilled at breaking complex concepts down into simple terms.

Remember, if you don’t understand a concept enough to explain it to someone else, you can’t apply it in your life to help you succeed.

Please remember that different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this content, will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for you or your portfolio. Due to various factors, including changing market conditions, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter (article) serves as the receipt of, or as a substitute for, personalized investment advice from Searcy Financial Services, Inc.

The content of this letter does not constitute a tax or legal opinion. Always consult with a competent professional service provider for advice on tax or legal matters specific to your situation. To the extent that a reader has any questions regarding the applicability of any specific issue discussed in this content, he/she is encouraged to consult with the professional advisor of his/her choosing.  

Published for the blog on September 27, 2021 by Searcy Financial Services, your Overland Park, Kansas Fee-Only Financial Planner and Investment Manager.