Have you received a financial wake-up call?

financial wake-up call

Widows, divorcees face financial wake-up call when spouses are gone

By Erin Arvedlund, The Philadelphia Inquirer

July 21, 2017

“Widows and divorced women need to plan for retirement differently. That’s the advice from financial planners and studies by Allianz, Lincoln Financial Group, and the Center for Retirement Research at Boston College.

Women pay a higher economic price for divorce, separation, and widowhood compared with men. Older wives are doubly disadvantaged relative to their husbands because, among other factors, they’re less likely to recoup their losses from divorce by remarrying, according to a 2016 Center for Retirement Research study. Furthermore, men typically make more money than women, are more likely to have access to pensions, and are more likely to achieve financial security and live above the poverty line in later life compared with women, regardless of marital status.

About 65 percent of women save less than they need to, compared with 55 percent of men, according to the 2017 Lincoln Financial retirement survey, based on a national sampling of 2,509 full-time workers ages 21 to 70 who have been contributing to their current employers’ defined-contribution retirement plans for at least one year.

So what’s an aging American woman to do? First, seek out help, starting with a financial adviser, particularly one who is a fiduciary — the term means the adviser puts clients’ interests first, ahead of the paycheck.”

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Organize and simplify your finances

Managing Your Money in Old Age

Declining financial abilities may not only result in a few unpaid bills but also leave you vulnerable to financial abuse and drain your nest egg.

simplify your finances

By ELEANOR LAISE, Senior Editor
From Kiplinger’s Retirement Report, April 2017

“After Robyn Downing moved in with her ailing father in 2010, she gradually uncovered a financial quagmire. She found he had eight different checking accounts at four different banks. ‘He was writing a whole bunch of checks’ to charities he’d never supported before, she says, and he hadn’t kept a checkbook register in two years. He owned several rental units, and one of his tenants hadn’t paid any rent in nine months, says Downing, a retired children’s theater director in Gladstone, Mo.

‘He was really being taken advantage of financially,’ says Downing, age 62, who estimates that her father lost roughly $50,000 before she stepped in to help. During the four years prior to her father’s death at age 91 in 2014, Downing consolidated his accounts at one bank, organized the bookkeeping for his rental units and discouraged his habit of giving his credit card number to anyone who called on the phone. ‘What a pain it was to try to straighten things out,’ she says.

Financial capacity—the ability to manage your finances in your own best interest—involves everything from paying bills to reading a brokerage statement and weighing an investment’s potential risks and rewards. And preparing for the potential decline of that capacity is as important as planning for long-term-care expenses or keeping your estate plan up to date. Declining financial abilities may not only result in a few unpaid bills but also leave you vulnerable to financial abuse and exploitation, drain your nest egg, and place heavy burdens on your loved ones.”

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