Think back to the person you were 10 years ago. Do you feel more or less prepared than that person to tackle your long-term financial goals? Or are you just about the same?
Despite the fact that more women are taking control of their household’s finances (not to mention earning as much if not more than their spouse), they’re not feeling any more prepared — or confident — than they did a decade ago when it comes to financial security, according to new research from Prudential.
For example, 75 percent of women believe having enough money to maintain their lifestyles throughout retirement is very important, but only 14 percent of women are very confident in their abilities to accomplish this according to the research. Ten years ago when the same question was asked, the gap between the numbers was very much the same. In other words — we’re stuck. More worrisome: Although women are feeling more financially secure now than they were just a couple of years after the recession, we’re now placing less importance on our long-term financial goals.
So, how can we boost our confidence — and ourselves into action? Here, a few suggestions from Jean Setzfand, vice president of financial security for AARP, and financial expert Lynnette Khalfani-Cox, aka The Money Coach, who were on site for Prudential’s release of the findings.
Focus on your future. “Bring the future to the present,” says Setzfand. “If you know what your future might look like, then you’ll be more motivated to figure out where the money can come from to support that.” I couldn’t agree more. I often ask people to envision what retirement looks like for them. Whether it’s an image of travel, or a view of the driving range, it’s something to focus on when you’re trying to decide whether to save for tomorrow or spend today.
Don’t just Google it. Even though there are multiple online tools and resources for DIY financial planning, there are times when you need to ask a pro. It pays. Some 53 percent of women who use financial advisors feel on track (or ahead of schedule) in planning and saving for retirement, versus 23 percent of women who don’t, according to the study. Setzfand suggests surveying the tools you have at your disposal first — often a workplace retirement plan will have both online planning tools and actual humans that you can access free of charge. If you don’t feel that does the trick, look for an advisor of your own.
Get real about money issues. “Women tend to put on that brave face, act like everything is okay, and present this facade of this perfect little image to the world,” says Khalfani-Cox. That doesn’t work when it comes to your finances. Because trying to trick others can lead to tricking yourself. Khalfani-Cox says get real. “Women need to talk to other women,” she says. “You [want to be] the girlfriend who says, ‘Yep I’m going to put 10 percent away in my 401(k) and max out my 401(k) — instead of saying, ‘Yep, I’m going to max out my credit cards.
Adjust your behaviors. And on that note, if hanging out with your girlfriends always means spending money (i.e. shopping on your lunch break and brunching on Sundays) — then it’s time to shake up your habits, too, says Khalfani-Cox. Start looking for free (or inexpensive) activities instead, like doing yoga in a nearby park or hunting for two-for-one deals on Groupon. “Also know that friends that budget together, save together. If you’re trying to meet a financial goal (i.e. cut back on spending or save for a big trip), you’re more likely to accomplish that goal with the support from a friend who’s making similar decisions.
Jean Chatzky is a member of the DailyWorth Connect program. Read more about the program here.