While women are demonstrating greater financial confidence, a new survey finds getting women to put a higher priority on saving for retirement remains a challenge.
In its latest survey released April 30, Female Financial Empowerment, Edward Jones revealed that seven out of 10 women say they feel confident in their financial knowledge, yet two in three say they have never consulted a financial advisor.
The survey found women tend to prioritize immediate family needs over saving in a 401k or other retirement savings vehicles. Only 25% of women indicated that saving for retirement is their most important goal in the next three to five years.
“Women put off investing for the future because they are waiting for the perfect time to begin. In reality, there will always be competing priorities in life, and the best time to start is sooner rather than later,” said Nela Richardson, Edward Jones investment strategist. “The potential ramifications for those who sit on the sidelines too long can inhibit their ability to make sound financial decisions and generate long-term wealth.”
To feel more financially empowered, female respondents indicated that getting more information on how to save for retirement (16%) was less of a priority than getting information on how to increase income to reach financial goals (32%) and how to budget for unexpected emergencies (18%).
Major life choices impacted
According to survey findings, a lack of financial confidence historically has been a deterrent for women, but they are optimistic in their ability to become more financially savvy with time and the right resources.
Thirty-eight percent of women said that a lack of confidence in their financial knowledge had a negative impact on a major life choice such as starting a family, buying a home or pursuing an education. This figure increased for Millennial women (55%) and women with children in the household (47%). Four out of 10 respondents say theyhave not taken or do not plan to take action to become more financially empowered.
Nearly half of women (49%) said access to additional income would most motivate them to become more engaged in their finances. Other motivators included experiencing an unexpected financial emergency (20%), a significant life event (20%) and an economic event, such as a recession (12%).
“By accurately defining what financial empowerment means to them, women can better identify their financial goals and the ways to achieve each of them,” said Kate Warne, principal and investment strategist at Edward Jones.
“Some women may find it empowering to work with a financial advisor who takes the time to get to know them and understand their short- and long-term needs as well as advocate for what’s most important to them. A financial professional can help them stay on track to achieve those important milestones in their lives and those of their families.”
Optimism paves road to financial empowerment
With women increasingly breaking barriers and shattering glass ceilings, the survey concludes optimism radiates through their sentiment on their financial futures.
Of the women who reported they weren’t yet confident in their level of financial knowledge, 40% said they believe they can become more financially savvy in one to three years. With a continued eye on the future,the majority of womenreported they have already taken or plan to take steps towards becoming more financially empowered, including self-educating through financial tools and resources (37%) and meeting with a financial advisor (22%).
“As women close the wage gap and begin to inherit wealth from aging parents and grandparents, they will need to be confident and influential in using these resources to improve their families’ futures,” said Warne.
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
