Estate planning is never static. As circumstances change, people have to update their financial readiness accordingly. For instance, several polls have shown that more Americans are delaying their retirement, thanks to improved physical condition and the desire to remain active for as long as possible.
While this has been observed among both sexes, the shift among women has been so significant that it just might reshape the economy, based on new figures and analysis detailed by The Wall Street Journal.
20 percent of 65+ women anticipated to be working full-time in 2024
"Only 8 percent of women in 1992 worked past the traditional age of retirement."
The workplace is perhaps the best example of this turn of events. Thirteen years ago, approximately 1 in 12 women worked past the age of 65, the Journal reported, based on Labor Department figures. The ratio has since grown to 1 in 7. In fact, in less than a decade, an estimated 1 in 5 women are projected to work at least into their late 60s.
Richard Johnson, director of the Urban Institute's program on retirement policy, indicated that this is a truly seismic shift has far-reaching implications.
"It's really one of the most stunning developments that we've seen in the labor market over the last 50 years," Johnson told the Journal.
While economists indicate that older women remaining in the labor force has the potential to improve gross domestic product, thereby fueling the national economy, women putting off retirement can affect lifestyle habits. This often warrants devoting more earnings to savings in order to accommodate a more extravagant manner of living.
"People are going to live longer and they're worried about outliving their savings," Paul Mangus, director of workforce development for Ohio-based Mature Services, told the newspaper. The nonprofit helps seniors find work, particularly those who have left their former careers to pursue something they've always wanted to do.
Higher net worth, but also more debt
"Average mortgage debt has more than doubled in the last decade."
The growth of women working later in life has been something of a double-edged sword in terms of finances and preparedness. On the plus side, for instance, older Americans are doing better today than they have in years past. Adjusted for inflation, the average household headed by a senior 62 years and older had a net worth that was 40 percent higher than his or her contemporary in 1989, based on the Journals's analysis. At the same time, though, older Americans also have more debt than in years gone by. In 2013, approximately 50 percent of homeowners 65 years and above owed an average of $88,000 on their mortgage. That's more than double the $43,400 they owed in 2001.
Women tend to be more concerned about debt than men. Late last year, the Insured Retirement Institute found in a study that women had higher levels of anxiety about financial issues than their male counterparts. IRI also found that women are more inclined to seek advice about finances, whether from a professional, family or friends.
Cathy Weatherford, IRI president and CEO, pointed out that older women's reliance on expertise makes it especially important for financial advisors to provide sound counsel.
"To overcome [life's] challenges, women will need to channel their concerns into positive actions," Weatherford explained. "This is an area where the retirement planning community can make a significant impact, but it will require a more thorough understanding of women's priorities, values and preferences."
For high net worth clientele, Leveraged Planning® Solutions can serve as the catalyst to living a life of leisure, where outliving one's emergency savings is not a concern. Agents are encouraged to get in touch with Global Financial Distributors to find out more information.
