Men, women and the savings disconnect.
A RECENT NORTHWESTERN MUTUAL STUDY found that gender makes a difference in how one views saving.
Men are more likely than women to identify themselves as "disciplined" financial planners (37 percent versus 31 percent). However, they are also more likely to say that their financial planning needs improvement (66 percent versus 59 percent).
A major difference between the sexes, which is crucial for advisors to be aware of, is their risk tolerance. Women are less likely than men to say they are comfortable with the risks that accompany growth strategies when investing.
Men, who exhibit a higher risk tolerance, are more inclined than women to invest in the market (17 percent versus 8 percent) and therefore, more likely to report that they have suffered losses to their retirement savings over the last three years (25 percent versus 9 percent).
While examining the reasons why Americans have fallen behind, the study found women are more likely to cite unexpected expenses (60 percent versus 43 percent) and debt (54 percent versus 40 percent) than men. Men are more likely than women to cite a lack of effective planning for the long-term as the reason they are behind on their retirement savings (42 percent versus 32 percent).
Individuals of both sexes over the age of 55 were surveyed and seem to feel that saving money early and often is essential. There are, however, notable differences in how they did so. Men are more likely than women to say that they heavily invested in their 401(k)s (35 percent versus 21 percent) and the stock market (17 percent versus 8 percent). Women seek more stable saving vehicles like annuities and insurance.
MICHAEL K. STANLEY, LIFEHEALTHPRQ.COM