As a financial adviser who has run plenty of seminars, I am frequently asked why the subject often relatWomen in the workplaceCredit: Image: Ambro / FreeDigitalPhotos.netes to women in investing.  Why should one’s gender affect investment choices?

The tendencies of women to prolong entering the paid workforce until their children are older, the frequency with which women are the primary caretakers of family members, and the lower glass ceiling for women all mean that women require specific attention in financial planning.

Older Women

I meet with many widows who have no idea how to handle their finances since their spouse was always the one who handled the money.  Older women sometimes need to learn the basics of finance and be encouraged to take the reins of their financial life.

The fact that women traditionally live longer than men means that allowances need to be made for additional cash flow after their husband’s pensions end.  Also, additional funds may need to be earmarked for extra years of health care.  Even if you live in a country with socialized medicine, long-term nursing facilities can really squeeze the wallet.


Middle-Aged Women

Women who return to the work force after taking time off to raise their families have fewer years to accumulate pension savings.  This means that their pensions may be inadequate to cover their retirement expenses.  Working women need to allocate additional savings to supplement anticipated pensions.

And even if a woman is working and has pension and savings accounts, she may have more expenses than her male colleagues.  If a woman CEO travels to a conference, her company may pay her expenses.  But who will pay for the extra hours the nanny needs to work in her absence, or the cost of taking along a nursing baby plus babysitter?  Working mothers have hidden costs of work which need to be taken into account in their financial plan.

Younger Women

A young woman’s asset allocation may have the flexibility of being more aggressive.  Now is the time to develop solid saving habits and a strong foundation in personal financial responsibility.

At all stages of life, including marriage and divorce, a woman faces unique financial needs.  Show the women in your life that you care for them by encouraging them to plan.

Read more about women and money issues here: Women, Money, and Power

 Disclaimer: This article is for educational purposes and is not a substitute for investment advice that takes into account each individual’s special position and needs. Past performance is no guarantee of future returns.