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Post-recession, women in control face new challenges.

The Great Recession forced some women to take an even more active role in managing the household's finances.

Yet, there are areas where they still need help with, according to a Prudential study, Financial Experience & Behaviors Among Women, which was based on a poll of 1,410 American women and 604 American men between the ages of 25 and 68.

While women have become more knowledgeable about retirement and insurance products, more of them would like to learn how to generate income in their retirement years, the data showed.

Fifty-one percent of women polled said they are not knowledgeable about generating income in retirement. Prudential found that women under 35 frequently identify themselves as investment beginners who are less likely to say they feel very well-prepared to make wise financial decisions than female baby boomers.

Ninety-five percent of women polled said they are more involved than ever in their households' investment and financial decision-making.

Although 86% of women said they are taking the lead in making those decisions, the majority said they are not confident about making financial decisions and do not fully understand many of the increasingly sophisticated financial products that are available.
Confidence of Breadwinners

 Female Male

VERY WELL PREPARED 20% 45%
NEED HELP IN A FEW AREAS 38% 37%
NEED TO CATCH UP IN MANY AREAS 29% 15%
I'M A BEGINNER 13% 3%

Note: Table made from bar graph.


Still, Prudential found that women are optimistic about the future and have a strong desire for financial education and guidance. When asked about the outlook of the economic recovery, 11% were very optimistic and 44% were somewhat optimistic.

That positive outlook can present a number of opportunities for credit unions and other financial institutions to fill in the gaps.

"The study shows with women in more control than ever of their finances, they face significant challenges when it comes to financial decision making and admit to a lack of knowledge about financial solutions that can help them," said Susan Blount, Prudential senior vice president and general counsel.

Past research from Prudential has shown that the vast majority of women have become primary or joint financial decision makers, Blount noted. However, this new data shows that consistent with demographic trends and reflecting the impact of the financial crisis, the majority of women today are responsible for generating their own and their families' income.

Still, the country's economic downturn has affected both genders. The majority of both women (70%) and men (65%) surveyed by Prudential said they lost ground as a result of the slow economic recovery, but the impact has been more severe for women.

Seventeen percent of women respondents, which was double the current national average, reported being unemployed. Only 39% of women had full-time jobs compared to 55% of men. For married women and those living with a partner, 30% said they've experienced a layoff within their household as a direct result of the downturn. Prudential said more troubling, more than one in three women surveyed report they are struggling to make ends meet or they are no longer able to keep up with expenses.

With the backdrop of the slow economic recovery, Prudential said Americans in general tend to be risk averse, but this is especially true for women. Seventy percent viewed themselves as savers rather than investors and are interested only in guaranteed or FDIC-insured products.

The study found that it was the exact opposite for men. Seventy percent said they were willing to take some risk for the opportunity of greater financial reward, and 40% said they actually enjoy investing.

While women are relatively confident in their ability to achieve financial goals such as buying a house, reducing debt, being able to support themselves and not being a financial burden to their families, Prudential found they are less confident about having enough money to maintain their lifestyle in retirement, protecting investments from volatility and not outliving or outspending the money they have saved for retirement.

Four in 10 women surveyed said they need help in specific areas to feel prepared financially. Fewer women than men feel very wellequipped to make wise financial decisions (22% versus 37%).

By far, women said they lack confidence about achieving one of their most important financial goals: retirement security.

"It is concerning that so many women do not feel they have the information they need to make the necessary decisions to help secure their financial futures," said Christine Marcks, president of Prudential Retirement. "Whether the financial services industry or advisers like it or not, given women's key role as primary breadwinners and financial decision makers, there needs to be greater emphasis on supporting women's financial needs and helping them plan for a secure retirement."
Profile of Adviser Usage Women with an Adviser

MEDIAN EDUCATION ETHNICITY
AGE

Years College | Black Asian Hispanic DC IRA
Old | White Plan

49 51% 62% 9% 12% 16% 59% 65%

MEDIAN FINANCIAL
AGE PRODUCTS
 OWNED

Years Mutual Annuity Stocks/Bonds
Old | Fund
49 48% 26% 46%

Women with No Adviser but Would Consider

MEDIAN EDUCATION ETHNICITY FINANCIAL
AGE PRODUCTS
 OWNED

Years College | Black Asian Hispanic DC IRA
Old White Plan

39 40% 52% 20% 8% 16% 44% 34%

MEDIAN
AGE

Years Mutual Annuity Stocks/Bonds
Old Fund

39 13% 7% 17%

Women with No Adviser but Would Not Consider

MEDIAN EDUCATION ETHNICITY FINANCIAL
AGE PRODUCTS
 OWNED

Years College White Black Asian Hispanic DC IRA
Old Plan

47 27% 62% 15% 7% 15% 34% 26%

MEDIAN
AGE

Years Mutual Annuity Stocks/Bonds
Old Fund

47 16% 6% 12%

 Not too well Not at all well

IRAS 26% 8%
LONG-TERM CARE 35% 9%
ESTATE PLANS 32% 14%
STOCKS AND BONDS 33% 12%
MUTUAL FUNDS 29% 15%
ANNUITIES 34% 21%

Note: Table made from bar graph.


The study found that women's confidence about achieving their financial goals, including those associated with retirement, increased when they worked with a financial adviser.

Compared to other women, those who currently use an adviser are more likely to be married, have a higher income level, feel they are either ahead or on track for meeting their retirement goals and more willing to take risk for reward, the data showed. Still, the number one reason why women don't work with advisers is because they think the service is too expensive, according to Prudential. Not having sufficient assets was a close second.

The Rundown

* Recession took a heavier toll on women's finances.

* Women want to learn more about saving For retirement.

* Credit unions and other financial institutions can fill in the gaps.

MICHELLE A. SAMAAD msamaad@cutimes.com
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Title Annotation:TRENDS
Author:Samaad, Michelle A.
Publication:Credit Union Times
Date:Sep 19, 2012
Words:1094
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