FINANCIALLY SPEAKING

WOMEN AND MONEY

Taking Control of your Financial Future In many ways, women today have an entirely new relationship with money than those of previous generations. Many women are buying homes on their own, raising children as a single parent, building thriving careers and owning their own businesses. As a result, statistics show that nearly half of women are now the primary breadwinners in their households. Yet, even as women control their financial destinies more than ever, there are still unique challenges that need to be addressed in order to ensure lifetime financial success and independence.

One of the biggest challenges is that women often have a longer time horizon to save and invest for, as on average, women live 5 years longer than men. In addition, they also tend to make less money (although this is improving somewhat, it is still an issue) and are more likely to experience time out of the workforce during their lifetimes than their male counterparts. With such challenges looming, how do we, as women, ensure we are in good financial shape for our lifetimes? Here are some suggestions on how one can build a strong foundation for a financially secure future.

Take Control of the Budget

Develop a clear picture of your current financial situation, even if it is not optimal- in other words, don’t try to ignore debt and spending issues, but face them head on. Make a list of your current income and expenses, focusing first on the expenses that are critical to you and your family’s lifestyle (rent, health insurance, etc.) and then reviewing discretionary spending (clothes, dining

BY LAURIE A. HAELEN

out, etc.). You may want to investigate some financial software to make this easier (apps such as Mint or You Need a Budget) to track.

Once you know the numbers, set goals, and direct your money accordingly. Many find that auto-deduction works great both for paying bills and spending, and most online banking systems can make that almost effortless. Save and invest your money regularly, but don’t forget to build in occasional rewards to keep you motivated. Being intentional, educated and informed about your financial decisions reduces anxiety and improves your financial outlook for the short and long-term.

Manage Your Debt and Credit

Build and maintain a good credit history in your own name and be aware of exactly how much you owe and the interest rate for each debt that you have. Develop a short-term plan to manage payments, avoiding late fees and paying off highinterest debt first whenever possible. You can get a free copy of your credit report once a year, but many banks and other services (i.e. Credit Karma) will provide a credit snapshot much more frequently. Reviewing your credit regularly will also help to spot any potential fraud/identity theft, as you can monitor what credit is in your name and ensure it is truly yours. Avoid opening too many accounts and keep your credit card debt low, utilizing lower interest rate loans/lines of credit for longer-term debt (i.e., home equity for home renovations).

Save for Retirement

Without traditional pension plans that many relied upon in the past for retirement income, investors today must fund a good portion of their own retirements. If you are fortunate enough to work for an employer with a retirement plan, you should definitely contribute to it- even if there is not a match for your contribution. If there is a match, you should contribute at least enough to get the full match-this is “free money” for you. Understand the different retirement options available to you, such as Roth IRA, Traditional IRA, Roth 401k, Traditional 401k and the impact they have on your taxes today and in the future when you take a distribution. Figure out what you will need in retirement to live on and achieve your goals and then work to save systematically to save the amount necessary to fund your plan. One thing that always seems to surprise people is how much the draw rate needs to be to get their income goals. Saving enough and investing in the right combination of stocks and bonds for your goals, will help ensure you can have a significant amount to live on in retirement.

Know When to Ask for Help

As a financial professional, it is easy to take for granted all the knowledge I have gained over the last many years in the business. Some people truly enjoy handling their own finances and building the habits necessary to meet their many goals. Others feel overwhelmed and are sometimes paralyzed by the challenges they face in becoming financially secure. A good advisor can help you by:

1)Determining your current financial situation by reviewing income, assets and liabilities and goals.

“In many ways, women today have an entirely new relationship with money than those of previous generations.”

3)Make recommendations and educate your about specific products and services.

4)Implement, monitor, and adjust your plan as needed.

One of the most important things we can do as women is to take ownership of our financial destiny. Money affects all of us and impacts almost every area of our lives, so we need to get comfortable talking about it and making decisions about it. By taking a few simple steps, you can become financially empowered and build a successful plan to meet your financial goals. President – Manager of Investment and Financial Planning Solutions, CNB Wealth Management, Canandaigua National Bank & Trust Company. She can be reached at (585) 3944260 x41970 or by email at lhaelen@ CNBank.com.