By Northwestern Mutual
When it comes to how women feel about their finances, the 2023 Northwestern Mutual Planning & Progress Study finds that just 51% of women say they feel confident or very confident. Just 43% of women feel financially secure, and only 44% think they will be financially prepared for retirement. This compares to 59% of men who feel financially secure and 61% who think they will be financially prepared for retirement.
“What our research tells us is that there is a gender gap in financial confidence,” said Tim Gerend, chief distribution officer at Northwestern Mutual. “The impact of inflation and the worries people have about recession and retirement are felt unevenly, but they are significant for both women and men. The bottom line is this: Uncertainty about the future is cutting into confidence for many Americans, and that’s where a trusted advisor can help individuals build a plan to help them take control of their financial futures.”
This isn’t news to most women; in fact, 66% of women think their financial plans need improvement. Younger women are most inclined to agree with this: 79% of Gen Z and 76% of Millennials feel this way.
Read on for what you need to know about how working with a financial advisor could help give you the confidence boost you’ve been looking for.
How an Advisor Can Work With You to Create a Financial Plan
- Step 1: It all starts by simply sitting down and having a conversation with a financial advisor. He or she will get to know you by asking you what’s important to you in your life right now — and what you envision for your future. This discussion may also help them identify some goals you may not have considered. In the near term, are you planning to get married, buy a home or start a family? If you’re a bit older, are you getting ready to send your kids to college, start a new business or prepare for a comfortable retirement?
- Step 2: Once your advisor understands your goals, she or he will ask you what financial strategies you already have in place. It’s likely you’re already doing some things that would be included in a plan, such as saving for retirement.
- Step 3: The next step is helping you prioritize what’s most important so you can think critically about your goals. For instance, is buying your dream house at the top of your wish list or would a starter home be a better fit? Looking further ahead, is it more important for you to have enough money to retire early or to have enough to see the world in retirement — even if it means working a little longer?
- Step 4: As you work through these questions, your answers will identify potential gaps in what you’re already doing financially. Now your financial advisor can tailor a plan specifically designed to help you balance the life you want to live today with the goals you plan to achieve in the future.
How Your Financial Plan Can Increase Your Confidence Level
A good financial plan includes a wide range of options that can help set you on the right path while being flexible enough to account for any detours down the road. These may include:
- An emergency fund
- A plan to manage debt
- Insurance to protect your family
- An investment plan to grow your money
- An estate plan
- A retirement plan
Knowing you’re on track to reach your goals and that you have a plan for things that could go wrong can help you feel more confident not just about the future but also about spending your money on what’s important today.
Providing this peace of mind is how financial planning helps you worry less and live more.
