The Unique Estate Planning Challenges That Women Face

Why do women face unique estate planning challenges? WHZ Associate Vice President Holly Wanegar, CFP® shares an overview and what to do about them.

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Transcript

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Welcome to you and your money. Today's episode features Holly Wenegar, associate vice president and wealth advisor at WHC Strategic Wealth Advisors. All right, today's topic. Unique financial challenges that women can sometimes face later in life. So first off Holly, why might women need to approach estate planning differently? Yeah, so they, women tend to face unique circumstances that can impact their financial future. Estate planning being one of them. And some of those factors are that women tend to Live longer than men. Theyre also more likely to have career interruptions such as caring for children or family members. And also they may not have as much or any of their own income throughout their lives. So these can create some unique situations that require some careful planning. Start with longevity. How much does women's longer life expectancy actually affect their finances later in retirement? Yeah, so longevity can be a blessing. However, it can pose a challenge for women as they typically live longer than men, which can require longer retirement periods, increased health care costs, living longer in retirement, as well as a big one, long term care costs, which we know can be substantial. So what steps can women take to address these longevity related challenges? Yeah, so first, creating a comprehensive retirement strategy that supports these unique challenges is very important and working with an advisor can help with that, of course, as well as exploring different options, for example to support long term care planning either insurance or there's plenty of strategies as well as making sure your legal documents like health care proxies and power of attorneys are in place so that your wishes are carried out. Yeah earlier you mentioned career interruptions to zero in on that. How does that impact women's estate planning? Yeah, so with some career interruptions either earlier in your career or later taking care of children or family, that can impact lower lifetime earnings which can reduce your retirement savings as well as Social Security benefits, which are the big pieces of what we call the retirement income pie. So that makes it very important for women to carefully think about their retirement income plan and plan accordingly. So let's talk about strategies. What strategies can women use to mitigate the impact of career interruptions? Yeah, absolutely. So if you're over 50, take advantage of some catch up contributions, for example in your employer plans or an IRA. And if you're married and say not working, don't have a lot of your own income, your working spouse can contribute to an IRA on your behalf, which is very powerful. And also educate yourself about investment and Social Security benefits. Consult with a professional for that, especially when it comes to like Social Security, spousal and survivor benefits later in life. Yeah, thank you. You also mentioned being single later in life. Can you elaborate on how that can affect finances? Yeah, yeah. So whether it be through divorce or widowhood, women are more likely to find themselves single later on in life which, which can pose a challenge being a single income household as well as being the sole decision maker with the responsibilities around finances as well as estate planning. So that's a big consideration right there. So how should women prepare for that possibility? What should they do? Yeah, so ensure you have a good understanding of your financial situation and your estate plan. If you're married, be actively involved in those decisions early on. Make sure you know what those documents mean, how to access those documents so that we can plan for them when they do come into play later on in life. All right, so again, all good advice. Holly, too regarding estate planning, it's very important. What about the broader strategies women can use to empower their financial futures as they get older? Yeah, absolutely. So first and foremost, as we know, knowledge is power. Educate yourself about these strategies. It may not be something you're familiar with. So building a team of professionals around you can really help empower you to feel comfortable about these complex strategies and building the right plan. Working with these estate planning attorneys, financial advisors and tax professionals to make sure everything is in place for your unique situation. And it's not a one and done sort of thing when you're planning. So when you set it up, make sure you're reviewing it because there are, you know, life changes and evolves, and these circumstances can impact that. And we might need to make some changes to our plan along the way. That's why you should have a regular sit down. Any specific estate planning tools that women should consider? Yeah, so one tool in particular that can be really helpful is a trust. And working with an estate planning attorney can help you with that because trust can offer more security and control over your assets to help mitigate some of those risks that we talked about and to provide you some benefits and making sure that your wishes are carried out in the event that you may become incapacitated. And again, you know, ensure you have the appropriate legal documents like health care. Proxies and power of attorneys are important. It's great topic really good stuff here too, today, Holly wrap up final piece of advice you'd give our listeners about estate planning for women. Yeah, so I think one of the biggest, might be the most important thing to do is start with having a conversation with your family. Be open and honest about the realities of this because it is a challenge that women face and ask questions and be curious and seek to understand and again, build that team of trusted professionals that have your best interest in mind so that you feel comfortable as we age. For more information regarding wealth management and customized financial planning with WHZ strategic wealth advisors, please visit whz wealth.com. wHZ Strategic Wealth Advisors offer securities and advisory services through Commonwealth Financial Network member FINRa SIPC, a registered investment advisor, fixed insurance products and services offered through CES insurance agency. They practice at 697 Pomfret Street, Pomfrethe Center, Connecticut 06259 and three nine two a Marrow Road, Tolland, Connecticut 06084. They can be reached at 860-928-2341 WHz Strategic wealth advisors do not provide legal or tax advice. The tenured financial services team strives to support clients in achieving their financial life goals while providing absolute confidence and unwavering partnership for life.