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Are You Waiting to be Financially Rescued?

Marriage was supposed to save us all financially. What a wake-up call!

As a teenager, my friends and I talked about going to college, graduating, then getting married. Of course, that would be the beginning of our fabulous careers with big salaries and wealthy lives. We didn’t care about a big wedding or having kids. The most important thing was to have someone to grow old with, which really meant sharing finances. But now that we’ve all grown up, things are different.

  • Some got married and became the primary breadwinner in the home. As primary breadwinners, they earn more than their husbands and money is tight.
  • Others got married and then divorced. Those ladies are now trying to figure out how to buy a new house, afford childcare, and plan for retirement alone.
  • The rest of us stayed single.

If you’re anything like me, you are still waiting to marry or even get married again. You may even hope that when you marry, your financial future will be brighter. Well, good luck on that! As a woman, the odds of marrying just aren’t in our favor. More importantly it won’t save your financial future.

There are 34M more women than men. It is statistically impossible for every woman to marry!

According to population data from the U.S. Census Bureau for 2017, when the total number of women age 21+ is compared to the total number of men age 21+ (legal age of adulthood in the U.S.), there are 34.5 million more women than men. According to a study featured on 538.com, in the average couple, the man is typically three years older than the woman. That means men under 23 are dating women under 21. That eliminates another 184 million men. As a result, there are 218 million more marriage aged women than men.

U.S. Census Bureau data comparing the number of men age 24+ to the number of women age 21+ shows there are 218 million more women than men.

U.S. Census Bureau data comparing the number of men age 24+ to the number of women age 21+ shows there are 218 million more women than men.

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According to Wikipedia the average age for men to marry in the U.S. is 29. There are more than enough men to date when women are in their 20s and 30s. However, by the time women turn 48 the number of men significantly drops. At that point, women outnumber men by over 197,000. By age 55, that number increases to nearly 35 million more women than men.

Do I have your attention?

Now let’s take this one step further by factoring in the marriage rate. In the United States less than 48% of people marry, and 50% of marriages end in divorce. Using the ratio of 92 men for every 100 women aged 48, only 44 women out of 100 women will marry (0.48 * 92 men = 44 men married to 44 women). But half will divorce. What does that mean for us?

Only 22% of women will have a partner to share the financial burden. The other 78% of us will find ourselves alone!

No matter how you slice the numbers, many of us women will find ourselves financially responsible for ourselves somewhere between the ages of 48 and 52. But for the majority us who never marry, the financial burden begins at age 18 – 21 and never ends.

Now to make the numbers simple I assumed that all couples that marry are traditional couples. If the numbers were adjusted to account for the variety of partnerships that exist, the financial impact is worse.

Why are women in a far worse position?

Women traditionally choose careers such as teaching, nursing, and human resources, which tend to have lower salaries and shorter income growth spans. On the contrary men traditionally choose careers as financial professionals, technologists, and doctors, which have higher salaries and longer income growth spans. As a result, women’s incomes peak at around age 39 compared to men’s incomes which peak at around age 48. These are the details behind the commonly cited factoid that women earn $0.79 for every $1.00 that men earn in 2017. According to Payscale, the lifetime earning gap between men and women is far less for women and men within the same profession. But then there’s another problem.

Although women save a higher percentage of their incomes than men do, women still have 40% less money in their retirement accounts.

According to the Wall Street Journal women save a higher percentage of their income than men. Women are also participating in their employer’s 401(k) plan at greater rates. However, women tend to choose the stable options in their 401(k) plan versus men who choose the higher risk, higher return options. As a result, women have at least 40% less money in their retirement accounts.

In addition, women feel less confident talking about finances and investing. This keeps us from seeking professional financial help. As women, we are also less likely to buy other investments such as stocks, mutual funds and ETFs. As a result, men have greater investment returns and retire with significantly more wealth than women. Let’s not forget that women live at least six years longer than men. Guess what that means? Women are 80% more likely to live in poverty during their retirement years!

None of this takes into consideration that 68% of caregivers are women. Many women caregivers have additional financial responsibility and receive no help. These caregivers are single mothers caring for aging or disabled relatives, and single mothers who don’t receive child support from their partners. And don’t forget about the impact of inflation! That makes the reality for women much worse. So what’s the solution?

Close the gap in investment knowledge!

Investment professionals and educators should be focused on:

  • Providing investment education targeted at the unique needs of women
    • Women need more investment education versus sales-based pitches
  • Encouraging women to be more proactive in seeking financial education to raise confidence levels about investing
    • Studies show that 80% of women actually want more investment education
  • Helping women build confidence in understanding investment vocabulary
    • Women shy away from asking important investing questions, which creates a barrier in building relationships with professionals who are loyal to their fiduciary responsibility
  • Educating women about:

Do It All Girl™…Invest in Yourself, not Just Wealth™!