DEAR SAVVY SENIOR: What retirement planning resources can you recommend to women? I’m 58 years old, divorced and living on a tight budget and need all the help I can get. — Financially Challenged
DEAR CHALLENGED: When it comes to planning for retirement, most Americans could stand to brush up on their financial knowledge a bit, but it’s especially important for unmarried women. Here’s what you should know.
It’s an unfortunate reality that most unmarried women — whether they’re divorced, widowed or never married — face much greater financial challenges than men in retirement.
Why? Because women tend to make less money (about 78 cents for every dollar a man makes) and have shorter working careers (due to raising children and/or caring for aging parents) than men. And less money earned usually translates into less money saved and a lower Social Security benefit when you retire.
In addition, women also live an average of five years longer than men, which requires their retirement income to stretch farther. And, according to studies, women tend to be less knowledgeable and more intimidated about financial issues than men, which means they don’t always handle their money as well as they should.
Because of these issues, it’s very important that women educate themselves on financial matters. Listed below are some good resources that can help.
• A good place to start is with the Women’s Institute for a Secure Retirement, a nonprofit organization dedicated to financial education for women.
At wiserwomen.org you can read and download for free a wide variety of easy-to-understand publications on retirement planning, money management, saving and investing, as well as Social Security, health care, annuities and more.
If you don’t have a computer or Internet access you can call 202-393-5452 and order hard copies of their publications and have them mailed to you for a few dollars.
• Another resource you should tap into is mymoney.gov, a U.S. government website dedicated to financial literacy and education that provides free information, resources, publications, financial calculators, checklists, budgeting worksheets and more, to help you make informed decisions.
You can also call 888-696-6639 and order a free “My Money” tool kit that includes a variety of publications on saving, investing and getting the most for your money.
• The Employee Benefits Security Administration, part of the U.S. Department of Labor, is another agency that offers a variety of publications including the 62-page booklet “Taking the Mystery Out of Retirement Planning,” and “Women and Retirement Savings” brochure.
You can see them online at www.dol.gov/ebsa/publications, or call 866-444-3272 and have them mailed to you for free.
• Also visit choosetosave.org, a website developed by the Employee Benefit Research Institute that offers the Ballpark Estimate retirement planning worksheet, more than 100 online calculators, brochures, savings tips and links to resources to help you manage your finances.
• You also need to get up to speed on Social Security. To help with this, the Social Security Administration has an online resource specifically designed for women that covers how marriage, divorce, widowhood, work, caregiving and other life or career events can affect your benefits.
It also offers information on SSI and Medicare benefits and provides calculators to help you figure out your future earnings at different retirement ages.
You can access this information at ssa.gov/women, or call 800-772-1213 and order their free pamphlet entitled “What Every Woman Should Know.”
If you need some hands-on help, consider getting a financial assessment or tune-up with a fee-only financial adviser. Costs for these services will vary from around $150 to $300 per hour, but it can be very beneficial to help you set up a retirement plan you can follow. See napfa.org or garrettplanningnetwork.com to locate an adviser in your area.
Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book.