It used to be that men handled the finances (primarily) and women handled well, pretty much everything else. Circumstances change and it’s important for people to change along with them. In this case, we want to share the highlights of an article by Kimberly Palmer for USNews.com, in which she divulges five things women should know about money.
From a simple mathematical standpoint, women are four times more likely to become widows, than men are to become widowers. It’s true at age 40 and still true at age 80. That’s why it’s important for women to learn about financing independently of their significant others. The odds are that they will have to deal with them at some point in their lives.
It’s easier to learn and practice good finance habits when you’re young, rather than waiting till tragedy strikes.
With that in mind, here are her five tips.
1. Know Your Money. Know how much your income is, how much and what your expenses are and the amount of your savings. Realize that the amount of money you have now, in all likelihood is not going to be enough. The cost of food, petroleum (gasoline and heating costs) and healthcare in particular are likely to go higher.
2. Keep records. If you become a widower, keep separate files on your husband’s expenses and your own. If you have questions do not hesitate to call a professional in the field for advice or help.
3. Make sure you have at least one joint account in case one of you has to access cash in the event of an emergency. There are plenty of legal reasons to make sure your name is on all assets as well, but that’s a discussion best reserved for another column.
4. Don’t make any rash decisions. Don’t sell your house in the first year. Your feelings and instincts will change numerous times during that time, so don’t make any decisions that you can’t reverse.
5. Make conservative investments. She specifically recommends a portfolio with 40% fixed income investments and 60% in equities, including dividend paying stocks.
On a funny note, Palmer recommends not watching financial-themed shows for advice; “watching them can cause unnecessary anxiety about the markets.”