Women do it all — lead households, pay bills, run companies. But when it comes to saving and investing, advisors say there’s more women could do to ensure they’re better off in retirement.

“Women often feel like they need to wait until they earn a higher salary or have accumulated enough money to get started,” says Sylvia Kwan, chief investment officer at Ellevest. “But time and compounding are powerful allies towards building wealth and achieving a comfortable retirement. We want women to get engaged early and to invest early and consistently.”

Reclaiming the past and present

Earning less, spending more

Over the course of their careers, women earn less. You’ve probably heard that on average, women earn 82 cents for every $1 earned by men. This pay gap is wider for many women of color. Making less means accumulating less in Social Security and pension benefits because both are based on earnings history.

Women also spend more — women’s products are priced 7% higher than similar men’s products — and women live longer lives on average, so they have to support themselves through a longer retirement period and manage any health issues that arise.

Career interruptions

Many women are caregivers of parents, children or both, and that can mean career interruptions, causing them to earn even less.

Since the beginning of the COVID-19 pandemic, over 2.5 million American women have left the workforce, according to the Department of Labor. The Federal Reserve Bank of San Francisco recently reported that job losses affected women more than men, with the “she-cession” hurting mothers the most. On top of the opportunity cost of not working are the additional costs incurred while caregiving for others.

Rewriting the financial future

But these complications don’t mean that women can’t be well-prepared for retirement. Margo Sweany, wealth advisor at RMB Capital in Denver, says more women have to start learning about personal finance.

Get comfortable talking about money

“I don’t like to talk about money” and “money can’t buy happiness” are frequent statements that Sweany says she hears from her female clients.

“So much learning happens in social settings and many women are missing out on valuable learning opportunities out of perceived propriety,” she says. “Money may not buy happiness, but it can buy health care, education and stability — things most women care deeply about and should feel comfortable talking openly about.”

Be better informed

Improving your financial literacy is key to financial success, says Linda Erickson, founding partner and financial advisor at Erickson Advisors, an all-female firm of credentialed wealth advisors in Greensboro, North Carolina.

“The only avenue for women to become more empowered financially is by being better informed,” she says.

If you can’t afford professional advice, Erickson says you can seek out local or online information and financial support groups. Community workshops are often available through organizations such as the YMCA, she says.

And depending on where you open your brokerage account, the provider may offer educational resources and tools for you to use.

“A good place to start is with a financial wellness program — which many employers offer to their employees,” says Jamie Ohl, president of workplace solutions for Lincoln Financial Group.

Focus on you and your financial decisions

“Women generally will defer their own care and maintenance to take care of others first, often leaving themselves vulnerable to challenges such as death or divorce,” Erickson says.

Just as important as prioritizing yourself is not passing your financial decisions over to your spouse or someone else, advisors say.

A 2017 Merrill study found that 52% of women feel confident in managing investments compared with 68% of men. Advisors say that having less confidence can lead women to defer financial decisions to their partner, which can cause problems if you get a divorce or your partner dies.

“Ninety percent of women will have sole responsibility for their finances at some point in time,” says Philip Weiss, principal at Apprise Wealth Management in Phoenix, Maryland. “If your spouse dies, your income will likely fall. Take charge of your financial future and learn key financial skills.”

Make the most of your time

Women are sometimes more hesitant to invest, Weiss says.

“This can result in higher cash balances and increases the likelihood they will face a shortfall in retirement,” he says. Cash usually loses buying power over time because savings rates are not high enough to keep up with inflation. Investing can potentially help grow your money so you can outpace inflation.

So advisors encourage women to invest early.

“One of the largest setbacks we see for women is waiting too long to get started with saving and investing,” says Kwan of Ellevest, a robo-advisor that builds gender-specific factors such as the pay gap, career breaks and longer lifespan into its investing algorithms for women.

And you don’t need a pile of money to start investing, advisors say. Ellevest’s platform has no investment minimums to help women get started.

“We literally have women who deposit less than $5 a month into their investment accounts,” Kwan says.

Consider investing in women

Haleh Moddasser, managing partner at Stearns Financial in Chapel Hill, North Carolina, encourages women to use ESG investing to “own your wealth” and “empower yourself and others.”

“By doing so, women can impact the social changes required to equalize the playing field,” she says.

ESG investing is a type of sustainable investing that incorporates environmental, social and corporate governance factors alongside financial returns when evaluating an investment. Moddasser cites examples such as investing in companies run by women, companies that pay women on par with their male counterparts and companies that provide child care to enable women to remain in the workforce.

“ESG investing has been shown to achieve comparable, if not better, returns with lower risk. Honestly, it’s a no-brainer for women,” she says.

Hire trusted help

“A financial advisor can help women take a holistic view of their finances, from accumulation to protection to distribution, helping them ensure all considerations are taken into account and planned accordingly,” says Ohl of Lincoln Financial.

Married women or those who had been married for 10 years or more can mitigate retirement income shortages by considering various Social Security claiming strategies, says Amy Braun-Bostich, founder and CEO of Braun-Bostich & Associates in Pittsburgh.

“They can also make sure the higher-income spouse has insurance to compensate for a spouse’s death or disability, and/or continuation of alimony or child support payments,” she says.

Braun-Bostich highlights other potential strategies women can use, including HSAs to pay for medical expenses in retirement, guaranteed annuity income, working longer, deferring Social Security benefits, maxing out retirement accounts and using long-term care.

Long-term care is essential for women but an often-forgotten aspect of retirement planning, says Molly Ward from Equitable Advisors in Houston.

“Women in the U.S. are more likely to outlive their spouses and also more likely to need long-term care, due to higher rates of disability and chronic health problems,” she says.

A financial professional can help to establish goals and figure out what strategies can help you reach your goals. Based on the level of service needed, there are different advisors to choose from to assist in meeting your needs.

The bottom line: Yes, there are hurdles, but women are resourceful. Just start making smart money moves now, advisors say.

“No matter the circumstances, if a woman is thoughtfully, thoroughly and proactively prepared, she has the power to change the course of her life and her family’s life,” Ward says.

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Original source: Nerdwallet