While facing the same uncertain market conditions and rising living costs as all investors planning for retirement, many single women are also contending with a more nebulous challenge: fear.
Four in 10 single women, or 44%, are worried about their ability to pay their monthly bills in retirement and one in three single women age 55 and older, or retired, expect to be paying down credit-card debt during their retirement years, according to a recent study by Nationwide Retirement Institute, part of the Columbus, Ohio-based insurance and financial services organization, Nationwide.
Many of the findings of the study echo what financial advisors tell Rethinking65 they are seeing among their single female clients.
“I would define single women’s most pressing planning need as financial security because they cannot rely on a spouse or partner,” says Stacy Miller, founder and chief executive officer of BayView Financial Planning in Tampa, Fla.
“The industry talks about financial freedom and financial independence, but I think it’s security that single women desire: a secure income, the confidence that their nest egg will be enough in retirement, the certainty that their loved ones will be safe and happy, and knowing they can weather whatever financial ‘storms’ come along,” she says.
Health and Other Worries
Angela Ribuffo, president and financial advisor of Raion Financial Strategies in Anchorage Alaska, tells us that single women’s most pressing concern is “will they have enough money to live a fulfilling life now and in the future, i.e. retirement?”
While married women share similar concerns, they feel they can share these concerns with a partner. Yet this decision can become tricky if women delegate their finances to a partner and are unaware of their financial picture. “This can be problematic, especially if their partner should predecease them,” says Ribuffo. “They find that they no longer know their financial situation or how their partner’s past financial decisions now affect them.”
Catherine M. Seeber, a principal and financial advisor at CAPTRUST Lewes in Lewes, Del., says that single women’s most significant planning concerns have evolved over the years. Previously, the “bag lady syndrome,” or running out of money, was a significant issue. Today one’s health and anxiety around being unable to care for themselves, or burdening the next generation, has become a top concern.
“Health issues can affect factors like life expectancy, insurability and healthcare expenses, which can have a significant impact on their financial plan,” she says, noting that these issues are especially critical considerations for single women. “Dual incomes provide security.”
Seeking Professional Guidance
To tackle these challenges, single women are seeking proactive solutions from financial professionals. The Nationwide study shows that more than one in three women, or 36%, now work with an advisor, and single females are working with advisors at a slightly higher rate than married women. More than four in 10, or 41% of single women worked with an advisor started in the past 12 months, compared to 37% of married women.
Miller says single women’s top concerns as they devise financial plans focus on cash flow, retirement planning, risk tolerance, insurance and estate planning. Eighty percent of women die as a single person, according to the Women’s Institute for a Secure Retirement. “So being prepared has never been more important,” she adds.
Miller says financial planners can help single women with advice that supports their unique financial situations and goals while educating and empowering them to make their own financial decisions.
“Planning for the things that are not just presently top of mind, but for those things that they haven’t even considered yet, should be one of the primary reasons to hire a financial planner,” she says. “Clients tell me all the time ‘I don’t know what I don’t know.’”
More Contact — and ‘Money Stories’
Seeber says financial advisors can help single women plan by guiding them through a process that prioritizes necessary actions; provides shorter, more frequent contact; and helps alleviate the anxiety and feeling of being overwhelmed that frequently accompanies the unknown.
“Understandably, single women need to be more proactive in their financial affairs,” says Seeber. “The key difference is that single women tend to have lower financial confidence, less involvement in long-term planning, and greater responsibility for comprehensive financial management when they do not have the support of a spouse.”
Ribuffo, a member of the CFP Board’s Women’s Initiative (WIN) Council, says a financial advisor must listen clearly to create trust and understand a client’s “money story.” A “money story” is what drives a client’s current financial practices: the stories she heard while growing up from prominent individuals in her life, such as her mother, father, aunts, uncles and pastors.
“This money story lays the foundation of their financial behavior. Once this planning story is uncovered — and the woman may not even know the importance of her money story and behavior — you can help them understand the ‘why’ of their concerns and financial behavior,” Ribuffo says.
She urges advisors to ask women to specify their concerns and then lay out options. “Break down ‘financial speak’,” she adds. “Our industry language can be very complicated and frustrating. Like going to a foreign country and not being able to speak or understand the language.”
Deeper Conversations
The Nationwide study showed that single women tend to be more proactive than married women when it comes to discussing retirement planning with their advisor. Among those who work with an advisor, 22% of single women, nearly double the 11% of married women, are establishing advance directives or living wills and identifying beneficiaries. And 27% of single women are likely to discuss converting accumulated savings into retirement income with their advisors, compared with 22% of married women.
The most common topics that single women are discussing with their financial professionals include: tax planning strategies (37%); accumulating sufficient savings to enter or stay in retirement (34%), and converting accumulated saving into retirement income (27%).
One fact stands out for 19% of single women and 25% of married women: They retain an advisor to feel more confident with their financial future.
The study indicates that nine out of ten advisors will be targeting more women clients over the next 12 months, an 11-point increase since August 2023. Nearly 96% of financial advisors feel capable of doing so.
The Big Picture
More female advisors are absolutely needed in the industry, says Ribuffo, noting that many women want to work with advisors with the same gender and ethnicity. At the same time, more and more male advisors are beginning to understand that women consumers have different concerns and needs. [According to the CFP Board, only 23.7% of CFP professionals are women.]
In addition to recruiting women, the financial advisory industry needs to retain, advocate and sponsor women to increase their numbers, Ribuffo says. “We need to encourage and mentor those women who want to pursue becoming a Certified Financial Planning professional, which is a focus for the WIN Council as well as the Financial Planning Association.”
Acknowledging the disappointing percentage of women in the financial advisory industry, Seeber says the issues facing single women remains the same. Financial advisors should weave healthcare planning, including an in-depth health insurance analysis, into their programs. She urges financial institutions and advisors to motivate policymakers to design and implement inclusive financial policies that empower single women and help boost their confidence. Eliminating gender inequality could significantly boost the country’s gross domestic product, she notes.
Additional Reading: Women’s Most Overlooked Issue
Policymakers need access to research and must understand the unique challenges and opportunities faced by single women. “Financial education and literacy programs tailored for single women are a crucial investment to build their confidence and capabilities in managing finances,” Seeber adds.
‘One-size-fits-all’ Fails
Seeber urges advisors to develop a deep understanding of their single women clients’ unique financial needs, preferences and behavior. “It’s essential that advisors avoid a one-size-fits-all approach and instead tailor their advice and services to the individual client,” she said.
She notes the Financial Transitionist Institute provides tools that help advisors communicate more than numbers and financial jargon. “Advisors need to focus more on listening, than talking, and use empathetic discovery questions to help clients move from feelings of despair to elation, which requires skill,” Seeber says. “This approach helps build trust and personal connection with the client, making them feel heard, understood and valued.”
Nationwide’s ninth annual Advisor Authority study, conducted online within the U.S. by the Harris Poll from January 8-23, surveyed 518 advisors and financial professionals and 2,346 investors, ages 18 and older with investable assets of $10,000 or more. Investors included a subset of 391 “pre-retirees” age 55-65 who are not retired, and subsets of 346 single women and 726 married women.
Paula L. Green is a New York City-based freelance journalist with more than three decades of reporting and editing experience that spans coverage of international business and finance issues to murders and politics at the Jersey Shore to presidential press conferences in Argentina and Mexico. She can be contacted by plgreen12004@gmail.com.
