Women and Money: 3 Risks Women Face (and What to Do)

Terri Spath |

In recognition of #EqualPayDay[1], we are taking the time to highlight 3 risks #women face with respect to their wealth, and what to do about it.

Women need to save differently for #retirement. Factors such as longevity, the investing gap, and caregiving can lead to less in retirement savings. There is a very real wealth gap that women face. 

What's different for women: 

1. The investing gap. Our own research, and that of other firms, shows that women are more likely to keep excess money in cash, rather than investing it for the long term. Cash misses out on potential growth and doesn’t keep up with inflation. When women do not invest what they have, it results in a lower overall net worth over time. 

What to do: Many women worry that investing involves too much risk, but there are a broad range of options for every comfort level and timeline.

2. The Sandwich SituationCaregiving. Most caregivers are women: for kids, parents, or a partner. Many women find themselves members of the “sandwich generation” - caring for kids under 18 as well as parents over 65. This life situation often means stepping out of the workforce, and lost salary, benefits, retirement savings, Social Security income, health care savings and more.

What to do: Keep saving for retirement. You may be able to use a spousal IRA (if you're married) or traditional or Roth IRA (if you have earned income, even if it's part time). If you aren't eligible for a retirement account, consider seeking additional income streams to invest in a nonretirement account.

3. Longer lifespan. On average, women live 5 years longer than men. Consider this: the CDC/National Center for Health Statistics says that 81% of people over age 85 are women. This ultimately means that women are more likely to be alone in retirement and caring for themselves financially, facing higher health care costs, and managing how long savings will need to stretch to cover living expenses.

What to do: We can help manage these moving parts or direct you to online calculators that will give you sense of your situation. This can help you understand if what you have is on track. Additionally, consider some extra ways to help protect yourself, such as long-term care insurance.

You deserve to feel empowered in your financial life. However, many women feel overwhelmed, overlooked, or underserved. We understand. It’s why we have taken all of our expertise and experience managing billions of dollars for hundreds of people over the past 25 years of bull and bear markets to create Zuma Wealth. Our solutions are customized to your unique life; never the industry standard one-size-fits-all.

You don’t need to feel alone. #WavesHappen. We can help.

[1] According to the National Committee on Pay Equity, March 14, 2023 is National Pay Equity Day. This date symbolizes how far into the year women must work to earn what men earned in the previous year.