A guide to wealth for women: redefining the journey

By Tina Hurley, Head of Planning & Ultra-High-Net-Worth Solutions, EVP | Citizens Wealth Management

_{As a strategic partner who helps clients navigate and grow in changing circumstances, Tina is responsible for the direct management of the Citizens Wealth Management financial planning and estate planning team, including a team of CERTIFIED FINANCIAL PLANNERS™, estate and tax planners, and trust officers.}

No two financial journeys are the same. Throughout all of life's stages, we all face different priorities, considerations and challenges. We all have unique financial goals and objectives too.

However, there are some core principles in how women should approach building, managing and transferring their wealth. These guidelines have stood the test of time and are broadly applicable, wherever you are on your wealth journey.

Ready to take the next step towards your ideal financial future? Discover key considerations and actionable advice for women to help you chart your path to wealth across four life stages.

Stage 1: Build momentum

In the early years of your career, you're looking to build wealth and financial security. The work you do in these beginning years can greatly contribute to setting you up for a successful financial future.

Now is the time to take personal ownership of your financial life and seek professional guidance. Don't let fear or uncertainty prevent you from taking action. A recent Citizens survey found that more than half (55%) of women felt confident or experienced about managing their personal wealth. However, 45% expressed that they felt confused or overwhelmed by it.¹

Build your confidence by learning all you can about personal finance and finding communities that support your growth. Financial education groups and conferences can provide the right environment for women to share experiences, learn from one another and gain valuable insights.

Here are other key moves to consider in this stage:

Open and maintain an emergency fund: This should hold three to six months of expenses to cover a job loss or other unexpected setbacks. Avoid using the account as a source of spending funds. Replenish it as necessary.

Invest into a qualified retirement account: This includes your workplace 401(k) or Individual Retirement Account (IRA). The money you put away in the early part of your career could enjoy several decades of potential growth through the power of compound interest.

As your career progresses, increase savings with a goal of eventually maximizing your retirement plan contributions up to the annual limit.

Redefine financial goals as necessary: As circumstances change, be flexible and willing to course correct. If uncertain about how or when to make adjustments, a financial advisor can help provide clarity on how to meet your goals. Track your progress and be sure to celebrate milestones along the way.

Work to advance your career: Regularly negotiate salary and benefits and seek out professional development opportunities.

Begin building your team: Explore using the services of financial advisors, accountants, lawyers and insurance specialists. This team should work together as a community of resources to help you build confidence and reach your goals.

Stage 2: Redefine priorities

As you move through major life milestones, you'll need to make financial adjustments. Marriage, having children and career changes are life-altering events that come with financial implications.

For example, many women experience career interruptions due to caregiving responsibilities. The U.S. Department of Labor found that the impact of caregiving on a mother's wages reduces lifetime earnings by 15%.² This makes it essential to plan ahead and maximize retirement savings when possible.

While managing all of life's changes, stay adaptable and don't lose sight of larger financial goals. Here are other important actions to consider in this stage:

For couples, have an open discussion about finances: Decide whether to merge bank accounts, how to handle existing debts as well as your financial goals and values. Then, create a joint budget that reflects your individual and shared financial goals as a couple. Also, make sure to update legal documents such as wills, beneficiary designations and insurance policies.

For new parents, adapt your budget: Parents need to adjust to new financial responsibilities, including child care, education, health care and everyday expenses. A financial advisor can help you update your financial goals and protect your family with life, health and other types of insurance.

Plan for other life changes: Other life changes can include divorce, a death in the family, or caring for elderly parents. To ensure continued progress toward long-term objectives, reassess your goals anytime there's a major life change.

Another factor that could be on the horizon is inheriting a windfall. With the Great Wealth Transfer, $124 trillion is expected to change hands by 2048, as baby boomers, the most financially prosperous generation in history, pass down their wealth to heirs.³

The Citizens survey found that a significant portion of women (29%) have already received an inheritance. Of those who received or expect to receive an inheritance, 44% indicated it was $100,000 or more and 15% said $500,000 or more.

While this can be a life-changing amount of money, it's important to take a step back and create a plan. A financial advisor can help you navigate these changes and feel confident about how to manage it.

Stage 3: Navigate the next chapter

Entering your retirement years comes with big changes. You've made your wealth through thoughtful planning and calculated risks. Now, those risks and goals must be reevaluated as you shift from wealth accumulation to wealth distribution.

Careful planning is important to ensure that the wealth lasts and supports long-term goals. Here are some top tips to keep in mind:

Consult with a financial advisor to create a wealth distribution plan: Developing a withdrawal plan that balances the need for income with wealth preservation is critical. A well-structured withdrawal strategy helps maintain financial stability and avoid spending down your nest egg too quickly.

Also, implementing tax-efficient strategies, such as using tax-advantaged accounts and understanding the timing of withdrawals, can help minimize tax liabilities.

Reevaluate retirement risks and needs: At this point, you should consider including long-term care insurance in your financial plan to cover potential future expenses.

On average, women have longer life expectancies than men. Women can help mitigate longevity risk—the risk of outliving their money—by investing in financial solutions that offer lifetime income.

Manage the mindset shift: Continue to embrace financial confidence, be adaptable and focus on your goals and values. Remain proactive and regularly review your finances.

Stage 4: Maximize your legacy

In this chapter, the focus often shifts from personal wealth to creating a lasting impact, centered around family and charitable causes.

Estate planning is something many of us don't want to think about. The Citizens survey found that 35% of women don't have an estate plan and that percentage grows even higher among baby boomer women (41%). However, an estate plan can help ensure your wealth is distributed the way you want. Here's how to approach it:

Establish clear wealth transfer goals: Consider how to support your family and the legacy you wish to leave with charitable organizations.

Employ experienced advisors: A seasoned wealth strategist or planner and estate planning attorney can help you craft your estate plan. There is no "one size fits all" approach. Focus on achieving your goals effectively and efficiently.

Create or update estate planning documents: Create an estate plan that includes wills, trusts and other legal instruments to ensure that your assets are distributed according to your wishes.

Define your own journey

As you navigate through life, remember to embrace the journey. Each chapter of your story offers new opportunities for growth. By staying true to your values, boldly taking action, and seeking professional guidance along the way, you can define what wealth means to you and chart your course forward.

Here to help you each step of the way, contact a Citizens Wealth Advisor* today for a personalized plan that fits your goals.

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