By Scott Kahan
You get in your car knowing you left plenty of time to arrive at the restaurant for your eight o’clock dinner reservations. Somehow, on the way you manage to make a wrong turn and get lost. Assuming you don’t have a GPS, what do you do? The stereotypical answer, which is probably true more often than not, is that men will keep driving around hoping to find their way. Women, on the other hand, will stop and ask for directions. So when it comes to finances and financial planning, is it any different?
Financial planning is about identifying your goals and objectives. Once this is done, the next step is to come up with the “road map” of how you reach your destination. Studies have shown that women deal very differently with their financial planning than men do.
Women often face more financial challenges than men as a result of lower salaries, prolonged career breaks, and relative longevity. Women tend to have smaller pensions or 401(k) balances, on average earn less than men while working, and are more likely to have part-time jobs with limited retirement benefits. Women also leave the workforce more than men to become family caregivers, further reducing their ability to save.
Whereas men are often more confident that they will have enough retirement income to live comfortably, women tend to be less confident in their knowledge about financial products and services and that they are on the right path financially. So logically this leads women to ask additional questions with the goal to become more knowledgeable about finances.
This way, when making financial decisions, having the information allows you to be more confident in that decision. When it comes to financial planning, being more confident with your decision making process allows you to stay the course and not panic with every headline or market drop.
So the next time you are lost and need help, stop and ask questions. Of course make sure the person you are asking is knowledgeable. By doing this, you have a much better chance of reaching that goal, whatever it may be.
Scott M. Kahan, is a Certified Financial Planner® professional and President of Financial Asset Management Corporation, a fee-only wealth management firm located at 26 South Greeley Avenue in Chappaqua. Call Scott Kahan at 914-238-8900 or write to firstname.lastname@example.org.