Article

Tips for Women to Build Financial Independence

Tips for Women to Build Financial Independence

Traditionally, women have been the caretakers of both the older and younger generations of their families. But providing care for family members is becoming increasingly difficult, as doing so may require a leave of absence from work and drain one’s bank account.

Every woman needs to balance her financial past with her financial future.

Here are some tips to help you with the management of your personal finances so you can look towards the future and start building financial independence.

March 8, 2021
Tips for Women to Build Financial Independence
Important Disclosure: Content on our website and in our newsletters is for informational purposes only. The information provided may (or may not) directly apply to your situation. We recommend that readers work directly with a professional advisor when making decisions in the context of their specific situation.

Traditionally, women have been the caretakers of both the older and younger generations of their families. But providing care for family members is becoming increasingly difficult, as doing so may require a leave of absence from work and drain one’s bank account.

Such income disruptions greatly affect a woman’s ability to save money, plan for retirement, and maintain financial security. In addition, older married women often provide care for their elderly husbands.

But who will help you when you require assistance? Even though younger family members may be more than willing to help, the costs of health care often exceed the amount of disposable income available to the average family. Perhaps, women and their family members need to look toward the future and start the planning process.

Your Planning Process

Every woman needs to balance her financial past with her financial future. By addressing the management of your personal finances as soon as possible, you can avoid disputes and build financial independence.

Here are a few things to think about as you start your financial planning process:

  • Durable Power of Attorney. This mechanism allows individuals to appoint a trusted relative or friend as a representative in legal and financial matters. The powers granted may be limited or broad in scope, and may vary from state to state. They remain in effect during disability or incompetence – although, in the event of incompetence, a guardian or conservator could revoke them. Some financial institutions are reluctant to recognize a durable power of attorney, so it is worthwhile to explore any potential problems beforehand.
  • Revocable and Irrevocable Trusts. A revocable trust allows you to retain control of your property, while delegating the responsibility for daily management to others. This arrangement gives you the flexibility to change the trust in any way, and at any time, as needs and circumstances dictate. As added protection, a revocable trust may remain unfunded as long as you are legally competent. On the other hand, when you reach a certain age and are willing to relinquish ownership of assets altogether, you may wish to consider establishing an irrevocable trust.
  • Informal Arrangements. You can also informally transfer property to your heirs, in many cases free of gift taxes, in exchange for being taken care of for the rest of your life. This arrangement, however, should be approached with extreme caution. Even with the best of intentions, it is possible that adult children could deplete assets through poor management, divorce, or creditor claims. Once the assets are gone, an aging parent could become dependent on the goodwill and financial circumstances of family members.

Review Your Plans Periodically

It may be necessary to periodically review these arrangements, as needs and circumstances change. You may also wish to consider consulting a qualified financial professional with experience in concerns facing today’s women.

Other content you may like

  • Navigating Layoff Rumors in the Tech Industry

    Navigating Layoff Rumors in the Tech Industry

    April 16, 2024
    Facing a layoff in the tech industry can be daunting. It also presents an opportunity for reflection, growth, and reinvention. In order to be better positioned to seize new opportunities, there are ways to approach the situation that focus on resilience, strategic planning, and a proactive mindset.
    Read this Article
  • Talking to Your Kids about Your Finances

    Talking to Your Kids about Your Finances

    September 20, 2023
    Communicating openly can help everyone prepare and plan for the future. This isn’t always as easy as it sounds. Many parents find it uncomfortable and are overwhelmed with where to start. Yet often, just discussing and thoughtful planning gives your whole family a sense of relief. Here are some tips to help you gather pertinent information and get the talking headed in the right direction.
    Read this Article
  • What's Driving the Market

    Podcast Highlight - Housing Pessimism and the Cost of Borrowing

    June 16, 2023
    A big part of the GDP is the housing market. With recent stats that indicate pessimism with home buying, the team talks about median house prices and the cost of borrowing in the context of a mortgage.
    Read this Article
  • Inflation Impacts Your Insurance Coverage Too

    Inflation Impacts Your Insurance Coverage Too

    April 25, 2022
    Inflation is making the news with soaring rates that haven’t been seen in 40 years. Because inflation affects future purchasing power, it also affects future life insurance needs and your family’s financial security. Make the necessary updates before you need them, when it’s too late. Read here about coverages you should consider.
    Read this Article
  • The link you have selected is located on another server. The linked site contains information that has been created, published, maintained, or otherwise posted by institutions or organizations independent of this organization. We do not endorse, approve, certify, or control any linked websites, their sponsors, or any of their policies, activities, products, or services. We do not assume responsibility for the accuracy, completeness, or timeliness of the information contained therein. Visitors to any linked websites should not use or rely on the information contained therein until they have consulted with an independent financial professional. Please click “Continue to Link” to leave this website and proceed to the selected site.
    phone-handset