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August 30, 2019
New Mexico’s Legal & Financial Weekly
Vol. 9.99 No. 35
FORECLOSURE SALES: 0 PROBATE: 20 AUCTIONS: 6 NOTICE OF SUITS: 2 OTHER: 40 SPANISH NOTICES: 1
Financial Readiness for Retirement By Beverly Custer
W
hen it comes to retirement savings and readiness, the statistics for women compared to men are alarming. A study by the National Institute on Retirement Security found that women over the age of 65 had an average income 25 percent below that of men of the same age, making them 80 percent more likely to be impoverished. As age increases, so does the disparity. For single and minority women, the disturbing trend worsens. Due to a variety of factors such as the wage gap, divorce, or careers that began later in life due demands of raising a family, women save less than half of what men do, according to a June 2019 article on Forbes. com.
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Here are a few tips Crow provides to get you started:
• You know what you’re bringing in and spending per month However, the future doesn’t have to be a hardship if women make now. Ask yourself, “How is that likely to change in the future and in retirement?” Some expenses might go up (family, medical, travel and some decisions now to plan for their retirement readiness. food); others might go down (tuition, mortgage, fuel). Holly Strickland, a client services manager at Retirement Extender in Check in often with Social Security to see what your estimated Albuquerque, became unexpectedly single in midlife and has developed • a personal strategy that will enable her to be financially prepared at benefit will be, and consider any pensions or annuities to determine how much income in retirement you might be able to count on. Also, retirement. consider the difference between that and what you think you’ll need to “My own personal plan is to work until at least age 70 and delay filing spend. That’s the amount that will have to be made up by your other for Social Security benefits until I reach the full retirement age. This retirement savings. will allow me to ‘double-dip’ and receive Social Security income to add Access online calculators to help you determine your savings to my savings the last four years of work,” she said. “I will still apply • for Medicare benefits when I turn 65 because if you need to at that time goals. Several are available at no charge and will tell you how much you but you do not, coverage may be delayed and cost more. Also, if you need to save to reach a specific dollar amount by a certain time. are divorced and were married for at least 10 years, you may qualify for receiving benefits on your ex-spouse’s record if you meet certain “It really comes down to income vs. outflow and living on a budget with enough margin to allow for emergencies,” he said. Retiring comfortably conditions.” is a matter of being able to live within your means now. Women who are divorced also face financial challenges not shared by their married friends, she said. A single income limits the ability to However, nationally respected personal finance expert Suze Orman save, expenses are higher when living alone, and singles don’t receive suggests women take an even more aggressive approach to saving for retirement: “Live below your means but within your needs,” she said in the same tax breaks. a recent interview with AARP. “Spend what you need, not what you can “Taking into consideration that women tend to have a longer life afford.” expectancy than men and that my grandparents lived until their late 80s and 90s, I anticipate a similar life expectancy. This means that even if For example, if you need a vehicle, she says, take out the least amount I retire at 70, I should plan on having to rely on retirement savings and of money you’ll need for a loan. She explains that even though you may be able to afford a more expensive car, you’ll have fewer payments and Social Security for another 15-20 years.” ultimately enjoy life more when you pay it off. She then advises that Anticipating and planning for health-related issues is also practical, you continue to drive the car for as long as possible without having a said Strickland. She suggests considering a long-term care insurance car payment at all. policy to ensure that if you do get sick or become unable to care for yourself, you will have the care you need and the policy to pay for some Finally, don’t be afraid to ask for help or to ask any professionals you speak with about how they get paid. Registered Investment Advisors or most of the cost. are bound by law to act as fiduciaries, said Crow, and are also regulated Strickland also advises taking advantage of employer-matched by the Securities and Exchange Commission and the Financial Industry IRA/401k salary reduction contributions and to contribute at least the Regulatory Authority. minimum of what your employer does. “That is free money,” she said. However, before you do anything, Tom Crow, president of Crow Financial Advisors in Albuquerque, suggests assessing your current - Prime Time Publishing, LLC. situation and making some calculations.