As an unprecedented amount of wealth shifts to women in the coming years, Trust Point is helping them own their future
We work with people from all walks of life at Trust Point and it’s rewarding to work with every one of our clients. But one group in particular — women — has caught our attention in recent years.
More and more, we see women with large retirement account balances that they’ve often achieved on their own, in a way that 50 years ago might have been challenging. We’re also seeing a wave of Baby Boomer women transitioning into the Chief Financial Officer (CFO) role of their households for the first time.
The reality is that women are positioned to hold incredible financial sway in the coming years, as they’ll be in charge of much of the estimated $68 trillion in wealth passed down from Baby Boomers.1 That, combined with surges in women entrepreneurs and business leaders and a narrowing pay gap, means that women are an emerging economic force.
That achievement is promising, but the immediate outlook is also complex as women balance careers, families and caring for older loved ones. Women are also traditionally more risk averse, more likely to plan for financially supporting adult children and tend to want to give more to charities — all pieces that play a role in their financial future.
Trust Point is here to help women make these big decisions, empowering them to manage their wealth with confidence.
Prioritizing Education
Research has shown that there’s a significant gap in financial confidence between men and women. One study done in 2023 found that though 75% of women are saving for retirement, only 19% are very confident that they’ll be able to fully retire with a comfortable lifestyle.
Part of that has to do with competing priorities — juggling retirement savings, emergency savings, credit card debt, and living expenses, including supporting children and caring for loved ones outside of work. And as mentioned, women tend to take fewer risks with their finances, which can impact retirement savings.
That’s where Trust Point can help. We place a high importance on educating our clients about their financial options — helping them build a plan, manage it more effectively and invest to meet their goals.
Recognizing the Role of CFO
It’s often assumed the husband will take the CFO role within a marriage — but that is changing.
Households often share financial management responsibilities, and in many cases, women are the CFO — nearly half identified as the one in charge of finances in a recent study.2 Contributing to that is the fact that more women are the breadwinners in their relationships than ever before.
Women should feel confident in owning that identity and bringing their voice to the table. When we meet with couples at Trust Point, we are careful to listen to the needs and goals of each individual. We encourage questions, keep an open dialogue and work in the best interests of the couple.
Overcoming Death and Divorce
Whether from death or divorce, eight in 10 women will one day be responsible for their own finances. This can be stressful, frightening and overwhelming for those who otherwise haven’t played a role in financial decisions.
But, we like to reassure our clients that just because they haven’t done it, doesn’t mean they aren’t able to. Going through a divorce or the loss of a spouse can take a big emotional toll and the financial complexities that follow can make it hard to navigate alone. Closing joint accounts, getting an estate in order, coordinating with family members — it’s best to slow down, avoid hasty decisions, and lean on a team of professionals.
Beyond those decisions, learning to manage finances day to day brings its own challenges and that’s something we often help with. From making investment decisions to finding all of the right paperwork for taxes, we meet our clients where they are. We’ll start at whatever level you need, so we’re sure you understand the whole picture and the path to meeting your goals.
Giving Back
Giving — both to family members and important causes — is a priority for many women and something we see a lot from clients.
Especially when it comes to children, women are often eager to help with school, help with a house, or support their children in other ways. If this appeals to you, Trust Point can help you explore options, such as charitable IRA distributions, in-kind gifts and other tax-advantageous methods.
Most importantly, we can help you strike a balance that will fulfill your wishes without jeopardizing your financial future.
Tips for Single Ladies
While single women may face more financial obstacles than their married counterparts, gaining financial independence and freedom is just as possible. Here are some tips to empower single women to boost their financial well-being and be prepared for the future.
Prioritize Your Retirement Savings
Prioritizing your retirement savings is a must. Contributing to a 401(k), taking advantage of your employer match, and investing in an Individual Retirement Account (IRA) are great ways to do this. It’s also important that as you near retirement, you create goals and plans for what will keep you busy in your later years — whether that’s traveling more, volunteering, spending more time with friends and family, etc.
Build a Budget
Using an easy-to-follow budget structure — like the 50/30/20 rule — is a great way to stay on track with your savings and spending. With the 50/30/20 rule, 50% of your monthly income is used to cover your expenses, 30% of that income can go towards your “wants” and 20% should go towards your savings. While different budgets work for different individuals, it’s important to track how much you are spending and to do what you can to eliminate high-interest debt.
Stay Up to Date on Disability Options
As a single woman, you have to depend on savings and disability insurance if you are unable to work. Because of this, it’s important to look into short-term and long-term disability options.
Update Your Estate Plan
If you’ve lost your spouse or gone through a divorce, it’s essential you update your estate plan, including designating new beneficiaries, checking your medical directive, and updating your power of attorney if needed. Long-term care insurance is another important factor to consider as you plan for your later years.
Work with a Financial Planner
Being responsible for your own finances doesn’t mean you have to do it alone. In a recent study, women noted that working with a financial professional helps them feel more prepared for their financial future, and 73% said they wished they had worked with a professional sooner. The financial professionals at Trust Point are here to help walk you through major financial decisions no matter what stage of life you’re in.
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Sources:
1 Women as the next wave of growth in wealth management, McKinsey & Company, 2020
2 2023 Women Money Power study, Allianz Life Insurance Company of North America, 2023
