Episode 326 | Author: Cris Caruso

From closing the gender pay gap to family caregiving, women are faced with unique money challenges.

On today’s episode, long-time Bossed Up trainer and financial wealth advisor **Cris Caruso** addresses some of the obstacles women face when it comes to building wealth and how to overcome them to create a secure, happy, and successful future.

Hi, I’m Cris Caruso, a financial advisor with Alcumus Financial group, a private wealth advisory practice of Ameriprise Financial Services, LLC. I am so excited to be here with you as part of Financial Literacy month!

I have been with Alcumus Financial group for 16 years and I have been working with Emilie and Bossed Up from its very beginning. Over the years of my work, I have developed a real interest in working with and educating women about money. I wanted to share some information and resources about four money challenges women face in today’s world.

For women, building financial confidence is about building knowledge and balancing life’s priorities, and mapping out a financial strategy can help make that happen. When you’re in control of your finances, you’re better able to be who you want to be, go where you want to go, and take care of the many aspects of your busy life.

Here are four financial challenges unique to women along with steps to overcome them.

Challenge #1

The income gap

Despite the vast strides women have made in the workforce over the past decades, women on average have lower incomes over their working lives than men.

There are two reasons for this:

White women earn - on average 82 cents for every dollar men earned in 2019. And while that is an improvement from the 64 cents for every dollar men earned in 1980. Nonetheless, the wage gap still exists.

Second, women are more likely than men to interrupt their careers to take care of children or other family members. This loss of income over the years can significantly impact women’s overall savings as well as Social Security and retirement benefits.

Lets talk about a few ways we can address this gap:

People who negotiate higher salaries up front tend to do better in the long run. But women don’t always come to the negotiating table. As you all know from listening to this podcast, negotiating your salary each time you change jobs is the best way to close the gender pay gap. Next time you switch jobs, within or outside of your current employer, be sure to negotiate for the salary you deserve.

Salary is important, but it isn’t the whole picture. The choices you make regarding workplace benefits have a real impact on building your wealth. Think of your benefits as a hidden paycheck. Making the most of these programs can add up to real savings over time.

Challenge #2

The likelihood of a longer retirement

Here’s another fact unique to women. In an age of extended lifespans, women live an average of 5 years longer than men, with many women outliving their spouses as long as 15 years. According to the Social Security Administration, that can translate into more living expenses and the possibility of more medical and long-term care expenses.

These trends can serve as a reminder to pay yourself first. Commit to saving part of each paycheck, even if it’s only a modest amount to start, as well as any windfalls you receive like tax refunds, bonuses, or gifts.

Challenge #3

Balancing multiple priorities

As women we make choices each day about where to spend our time and how best to fulfill our roles and responsibilities in the family, the workplace and the community. That can have a big impact on finances.

If you have children, you’re always thinking about their future. The financial impact of parenting is significant. The average cost of raising a child through age 17 is $233,610. Add college to the equation and that number increases fast.

The average cost of four years at a public college is $85,480, while the average cost of four years at a private school is t $194,040.

That’s why it’s never too early — or too late — to start planning for your children’s college education. One important thing to remember: You don’t want to jeopardize your retirement savings by paying too much for your children’s education. While no parent wants to saddle their child with a large amount of student loan debt, the fact remains, for every dollar you contribute to your child’s education, you often take a dollar away from your potential retirement savings.

In addition to the emotional toll, family caregiving can impact finances as well. Good communication can help avoid problems and expenses down the road. Families who have the most confidence about their financial future talk about money. Here are some starting points.

Talk about the future today. Don’t wait until an emergency hits. Start the conversation today.

Explore long-term care insurance. Depending on your parents’ age, health status and resources, they may find a long-term care policy makes sense to help cover nursing home and/or home health care expenses in the future. If insurance isn’t a possibility, work with your parents to earmark money for health-care costs.

Work together with your siblings. Most adult sibling disagreements stem from arguments about parental finances. Have regular family meetings with your siblings to make sure you are all on the same page when it comes to your parents’ care.

Challenge #4

Coping with major life changes

Divorce can be a challenging life change that impacts finances: When divorce hits, finances change. Pooled resources are divided, the financial balance changes and the prospect of managing the bills, the house and the kids may seem a bit unnerving. When legal fees are added to normal life expenses, divorce can get costly. Consulting with an attorney and a financial advisor can be a smart move to know what your options are.

Coping with Widowhood: Longer lifespans may mean many women will live through the death of a spouse. That can have a devastating effect on all aspects of your life, including finances.

Finally, You or a loved one may suffer from a serious injury, illness, or other debilitating event. You can never predict what will happen. As we’ve talked about earlier, making sure you have the protection you need, including life, disability income and long-term care insurance can help you prepare for life’s unexpected events.

Making sure your wishes are known — This is about the impact you want to make —today and in the future—on the people, charities and causes that are important to you. Planning now, no matter what age you are, can help maximize your giving and make your wishes known. Regularly updating your beneficiary designations, will, health care directives and power of attorney documents will make sure others have precise instructions and that those that you care about most will be cared for in a way that you wish.

I know we’ve covered a lot of ground in this podcast today, it isn’t meant to be overwhelming. I want to give you some ideas to think about as you think about your money and financial goals and how it relates to us as women. Financial knowledge can help you build a secure, happy and successful future. If you’d like more info about me and my team, I can be found at www.ameripriseadvisors.com/cristina.l.caruso

The views expressed here reflect the views of Cris Caruso as of April 15, 2021. These views may change as market or other conditions change. Actual investments or investment decisions made by Ameriprise Financial and its affiliates, whether for its own account or on behalf of clients, will not necessarily reflect the views expressed. This information is not intended to provide investment advice and does not account for individual investor circumstances. Investment decisions should always be made based on an investor's specific financial needs, objectives, goals, time horizon and risk tolerance. Past performance does not guarantee future results and no forecast should be considered a guarantee either.

Ameriprise Financial cannot guarantee future financial success. Ameriprise Financial Services, LLC, Member FINRA and SIPC.

Got a career conundrum you want Emilie to cover on the podcast? Call and leave us a voicemail NOW at 910-668-BOSS(2677).

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