Financial fears can paralyze anyone from making a decision about money, but for many women, money matters are particularly terrifying. In fact, according to a GOBankingRates study, women are more likely than men to name “living paycheck to paycheck” as their number one financial fear versus just 17 percent of men.
So, why all the fear? What's holding females back? Here are five of the most common fears women have when it comes to money and ways to help overcome them.
1. The Fear They Won't Be Taken Seriously
Women have come a long way in terms of independence and earning power over the last 50 years, but many women still see investing and money management services as an industry geared toward men. This view can leave women feeling intimidated and concerned about how financial professionals will treat them. The good news is that their fears are often unfounded. Even so, women may feel more confident simply by learning more about finances or by working with a female financial advisor.
2. The Fear of Running Out of Money
Both men and women are afraid of outliving retirement savings, but women find it a much more pressing concern for one simple reason: women tend to outlive men by as much as five years. This means that women, on average, will require almost a fifth more in their nest eggs than their spouses. Women who think that they don't have a significant retirement fund may want to work longer and wait until they are entitled to receive their maximum Social Security benefits before retiring.
3. The Fear of Losing a Spouse
No one looks forward to a spouse passing away, but the death of a partner can have severe financial repercussions for many women. This is particularly true for women whose spouse was the primary earner in the family.
A woman can ease her economic apprehension by getting more involved in family money matters as soon as possible. The first step is to find out about all the family's accounts and investments and obtain full access to those accounts. It is also a good idea to have a life insurance policy for the spouse. Some experts suggest having a minimum policy that can cover between six and ten times what would be the lost annual earnings, plus enough money to pay off any outstanding debts.
4. The Fear of Losing a Home
It is hard for anyone to imagine losing their home. That is why it is smart to aggressively pay down any outstanding money owed on the house to become mortgage-free as soon as possible. But it is also important to keep in mind that while a home is an investment, the upkeep can be a financial drain. Older homeowners may want to think about downsizing to a smaller, maintenance-free (or reduced) home or condo.
5. The Fear of Having to Pay For Your Kids Forever
There is no getting around the fact that having children is expensive but being a great parent shouldn't mean paying the kids' bills forever. Parents need to know that setting boundaries when it comes to providing financial support for adult children is healthy, and in the long run, the right choice for everyone.
Money is a complicated topic, and one of the best ways to ease fears associated with it is to talk with a professional money advisor who can create a personal plan to help reduce your worries.
Erickson Braund is the Founder and Chief Financial Officer at Black Walnut Wealth Management. He is a Certified Financial Planner®️ professional and a Chartered Retirement Planning Counselor®️. Eric brings over 20 years of experience working with high net-worth individuals and families, helping them achieve their goals of protecting and growing their wealth for retirement and for generations to come. Because Eric is a CFP®️ professional, he adheres to high ethical standards and engages in at least 30 hours of approved continuing education in the financial industry each year.