Friday, February 24, 2012

Women and Finance

Recently, a younger Facebook friend ranted about an older woman in one of her community college classes, who was in school because she had to go to work to support herself after becoming a widow. This woman was old enough to be on social security – and her problem occurred when her husband passed away, she learned there was no savings, and his social security for her would be cut. My young friend was angry at the woman for not planning in advance with her husband for a possible bleak future without him, and receiving social security even though she never worked outside their home.

I bit my tongue on this one – and curbed the urge to let the young lady have it with both barrels. But I’ve been thinking about this all week and decided I need to spout in one form or another on the topic. So dear readers – you lucked out! I’m spouting on my blog.

My own generation (the same as my young friend’s mother), has had the opportunity to learn from the generations of women before us.  My grandparents were married for 70+ years, passed away within months of each other. My grandfather planned carefully and saved all he could so they could live comfortably after he retired. He also had 2 pensions and social security. My grandmother never worked outside the home. Grandma never had to worry about finances, but she always had a hand in planning the family finances. My parents have also saved over the years, and I believe their standard of living actually improved when they retired. Yes, my mother worked a job outside the home. She didn’t make a lot of money, but contributed all the same. Finances are arranged so that Dad’s not worried about Mom should he go first.

I have been fortunate though, to see the alternative to that life. A mother-in-law passed away in her late 50s, penniless. Her standard of living was nowhere near what my parents had, and when she died, she was lucky to have life insurance through her employer that paid for her funeral. Had she lived past retirement age, she would have probably had to continue to work.  Another – the second wife of the same father-in-law – discovered after her husband died that he had closed out all of the savings and cashed in his life insurance years before he died. All she had was a little social security and her part-time job. She lives in subsidized elderly housing now. Just like the woman mentioned at the beginning of this blog – she counted on her husband to take care of her.

Women in previous generations didn’t have the kind of resources of my generation or those coming behind me. In most cases, women were expected to be homemakers and to trust their husband would provide for them, even after he was gone. The average married woman will find herself widowed at 56 (my family beats those odds…), and can expect to live another 27 years (yes, we tend to beat that one too).  The reality is this: (and this is why I find myself fortunate) if we don’t take an active part in our financial planning, we can suffer the consequences.  At 50, chances are pretty good that I won’t remarry. I realize this, and I’m not expecting Prince Charming to come along and rescue me. I started planning for my future some time ago. Granted, with only one income, I don’t imagine that I will live as comfortably as my parents, but I won’t be penniless and living in government housing if I have any say in the matter. And my children won’t have to worry about supporting me in my old age.

I hope not to be in the situation that I have to work until the day I die – provided I live as long as my ancestors. We’re a long-lived bunch. I also want to enjoy retirement – and not retire just to sit around and count days.  And I hope my kids are learning from these things as well – and paying close attention. When they are ready to retire – we may not even have social security. Heck, at the rate things are going, I may not have it when I’m ready to retire. Plan, prepare, save… now. The earlier you start, the easier it is. And always remember – don’t expect someone to take care of these things for you. Things don’t always work out the way we want.

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