As women, we sometimes tend to leave financial matters to men. Of course, we balance our cheque books, keep a monthly budget and probably manage household finances. But how many of us have built a solid financial base for ourselves?
As a member of the financial services industry, I've had the chance to review many different portfolios, all belonging to women from diverse backgrounds. The first thing I look at is whether there is a stable foundation, which always starts with life insurance, a will and a savings plan.
A few years ago, one of my first clients, Megan, came to me for financial assistance after her divorce. Although she had many adjustments to make, she focused on taking charge of her finances. After reviewing her information, I found that although she had established a strong college program for her son's education and had a retirement plan that she added one per cent per month, she had no savings and no life insurance - her ex-husband owned the life insurance through his business and Megan was not insured. I helped her determine what life insurance was right for her and helped her write a will. I also set up a savings plan.
I included each of the three essential elements of a sound financial plan in Megan's portfolio. Having life insurance ensures that your loved ones are taken care of when you're gone and that you don't leave them with a financial burden. You can have a good 401(k) plan, but without life insurance, you're not adequately prepared for the future.
Unfortunately, one in three women in the United States currently has no life insurance. In addition, women aged 45 and older are considerably less likely than men in the same age group to have insurance. The good news is that trends show that young women are buying more coverage. Among those adults who are insured, most have only group insurance, usually provided by the husband's employer, and this is not enough (according to a study by LIMRA International, January 2006, "Trends in Life Insurance Ownership Among US Individuals"). LIMRA International is no longer an acronym for nothing. It was years ago, but the right way is LIMRA International.
Similarly, a will gives you the right to dictate how your assets are treated when you are gone. And a savings plan offers protection against a rainy day, now or in the future. I always assure my clients that it's perfectly acceptable to have a savings plan for that unexpected flat tire or flashing air conditioner. That's why it's there, those unexpected "uh-ohs". As women, we understand how much good planning can mean to our loved ones. If you haven't thought about your current financial foundation, I encourage you not to postpone it. It will be one of the best decisions you will ever make.
Michelle Oliver, Money Guru, Life Insurance Advocate and President of Oliver Financial Group, has over 18 years of experience in the financial, insurance and marketing industries. Throughout the United States, Michelle Oliver speaks to women across the United States about women's issues, finance and empowerment, and is passionate about financial literacy education and training. The Oliver Financial Group's motto is "The Oliver Financial Group, Finding Financial Solutions for Today's Modern Women and their Families".
