At every life stage, from their 20s to their 60s and beyond, it’s vital for women to make specific financial plans and strategies thanks to their specific life and career patterns.

Despite a higher likelihood of career breaks and reduced hours of work, women can still actively and positively manage their own financial futures.

The best way to do this is by seeking advice, engaging with your finances and planning at every life stage. Here’s how.

20s

The start of your career is an excellent time to set up a regular savings discipline. Look at ways to top up your super tax-effectively, such as through salary sacrificing or making personal tax-deductible contributions. A little now can prevent you requiring greater financial sacrifice later on and can help to prepare you financially for potential career breaks. Also, check your super statements and understand what it is that you are investing in. Perhaps the default option in the fund won’t make your money work as hard as it could while you are in your 20s.

30s

This is the most likely age for women to have career breaks so look at ways you can continue your super contribution momentum, such as spouse contributions. It is possible that you have had a number of jobs by now, so this is also the perfect time to consolidate multiple super funds. Update your personal insurances, taking into account new debt levels, responsibilities and new or future family members. And work on developing a strong understanding of your current household cash flow in order to plan for career breaks.

40s

Typically you’ll now have increased capacity, thanks to a return to work full-time or part-time, for superannuation top ups. During these higher income years consider salary sacrificing into superannuation as well as making personal tax-deductible or after-tax contributions. This is a perfect time to get the maximum amount into super. Interestingly, this is also the age that women are most likely to opt out of the corporate world and start up their own businesses – which they do at twice the rate of men. So if you’re an entrepreneur and the value in your business forms a part of your retirement funding, you should carefully plan the business from the start-up phase through to the exit strategy and know what it means to your super.

50s

This is the peak earnings decade so be sure to see your financial planner, maximise your super top up and plan your transition to retirement. Planning for retirement, and ensuring you will have enough in your super to make it happen, starts with knowing what your retirement is going to look like. What will your expectations be in terms of quality of life, travel, entertainment, lifestyle etc? It is also important at this stage to begin thinking about the psychological impact of retirement and what it will mean to you. Retirement is about both health and wealth, so do all you can to prepare for both.

60s

Finally it’s time to begin full retirement planning and to perhaps start familiarising yourself with aged care options for further down the track. As well as retirement planning and aged care planning, the third and equally important strategy to have in place right now is estate planning. Get these right and all you’ll have to do is relax and let the joy of retirement wash over you.

General information only: The information in this message is of a general nature only and has been prepared without taking into account your particular financial needs, circumstances and objectives. It should not be construed as financial, taxation or legal advice. Before acting on the basis of this information, you should consider its appropriateness to your own objectives, financial situation and needs. Individual advice can be provided by contacting our office at admin@completefinsol.com or by phone (08) 9330 8886.

Being faced with cancer can have a devastating impact on women and their families. That’s why it’s so important to reduce your health risks – and also know how to avoid the financial shock that a cancer diagnosis can bring.

October is Breast Cancer Awareness Month, with fundraising activities held across Australia to raise money and awareness to support women affected by breast and gynaecological cancers.

It’s also a time for women to reflect on their own lives. For example, if you were struck by cancer, what would be the emotional and financial consequences for you and your loved ones?

How to be cancer smart

No one wants to think they’ll ever suffer a serious illness, but the sad reality is that cancer affects many of our lives. In fact, one in two Australian men and women will be diagnosed with cancer by the age of 85¹. While the threat of cancer is very real for every woman, there are ways you can reduce the risk – or at least ensure that if you ever get diagnosed with cancer, it can be treated as effectively as possible.

1. Know your family history: Most people have someone in their family who has suffered from cancer at some stage. In some cases, an inherited ‘faulty’ gene can be passed onto their family members as well – genetic testing can help you find out if you carry this type of gene. And while some cancers aren’t hereditary, family members may have lifestyle or environmental factors in common that can lead to cancer, like smoking or overexposure to the sun.

 

2. Get checked regularly: Early cancer detection improves the chances of successful treatment and long-term survival, so it’s vital to get checked regularly. For example, women over 40 are advised to take advantage of free Breast Screen Australia mammograms every two years. Also, the National Cervical Screening Program recommend women aged 18-69 have Pap tests every two years.

 

3. Stay healthy: Although there is no cure, the Cancer Council of Australia recommends some simple steps you can take to lower your risk of cancer. These include quitting smoking, maintaining a healthy weight and diet, protecting your skin from the sun, limiting your alcohol consumption and getting regular exercise.

How to avoid a financial shock

Aside from the physical and emotional burden, being diagnosed with cancer can have a serious financial impact too. On one hand, you’re likely to have significant medical expenses to manage, while at the same time, you could be left without an income if you’re unable to work during your treatment and recovery.

 

In fact, according to the Cancer Institute NSW, the out-of-pocket costs of health care are rising well above the Consumer Price Index, which is influencing some patients’ decisions about whether or not to get the treatment they need². On the bright side, there are a range of insurance options that can help you cover costs and protect your finances if you’re ever faced with cancer.

 

One example is trauma insurance, which provides a lump sum payment if you’re diagnosed with a critical illness like cancer or stroke. There’s also income protection insurance, which can give you regular payments to make up for the loss of income if you can’t work due to sickness or injury. Life insurance provides a payout to your loved ones if you pass away, and in some cases you can access some of your insured benefit early if you become terminally ill.

 

It’s also wise to have an up-to-date Will in place – even if you’re fit and healthy. Creating a Will is an opportunity to think about who you want to leave your assets to, and it gives you peace of mind in knowing your wishes will be carried out if you pass away. Plus, it’s a good idea to nominate eligible beneficiaries for the assets that don’t automatically form part of your estate, such as your superannuation or life insurance. And by taking care of your estate planning needs now, it means you won’t have to worry about it if you do become ill.

How to get the right plan

It’s worth talking to your financial adviser to make sure you have the right types and levels of insurance cover for your situation and lifestyle. Your financial adviser can also help you put together a comprehensive estate plan and provide you all the financial guidance you need to understand your options, so you can make the right decisions for you and your family.

1. Cancer Council Australia, Facts and figures: Cancer in Australia, 9 February 2017.
2. Cancer Institute NSW, Out-of-pocket expenses influencing health outcomes, media release, June 2016.

IMPORTANT INFORMATION

This document has been prepared by Financial Wisdom Limited ABN 70 006 646 108, AFSL 231138, (Financial Wisdom) a wholly-owned, non‑guaranteed subsidiary of Commonwealth Bank of Australia ABN 48 123 123 124. Mark Giles of Complete Financial Solutions (WA) – Financial Planning (ABN26 050 157 938) is an authorised representative of Financial Wisdom Limited (ABN) 70 006 646 108 AFSL 231138).

Information in this document is based on current regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Financial Wisdom, its related entities, agents and employees for any loss arising from reliance on this document.

This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. Taxation considerations are general and based on present taxation laws and their interpretation and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information.

 

WORRIED ABOUT RUNNING OUT OF MONEY IN OLD AGE? WE TALK TO RETIREMENT EXPERT AND WOMEN’S ADVOCATE NICOLETTE RUBINSZTEIN ABOUT WHAT WOMEN CAN DO NOW TO HELP THEIR LONG TERM   FINANCIAL SECURITY.

 Inform: Is financial literacy a women’s issue?

Nicolette Rubinsztein: When looking at financial literacy, women often rank lower than men. We are often just as informed and capable, but are frequently less inclined to take the next step to apply that knowledge. And I think that comes back to confidence.

Studies have shown that women are often less confident than men. This is partly due to conditioning, in how we raise our daughters. We tend to encourage girls to be perfectionists – not to be brave. There are also some physical factors that can come into play, how our brains work and the influence of hormones on behaviour.

Together, these can undermine women’s willingness to take action, and that includes when it comes to making financial decisions and taking control of their financial future.

 Q: What are the key financial risks for women?

NR: I think that one of the biggest risks is running out of money in retirement. We need to think about our longevity risk – as we’re probably going to live much longer than we think. As women, there is also a very good chance many of us will outlive our partners, which could mean we spend our final years on our own.

There are some great tools online that can help you estimate your life expectancy. When I did it, I had a number in my head – around 87, the age my grandmothers died. But the calculators estimated around 95 to 100 – much higher than I had thought.

When my husband did it, his estimate was 90 – which raised the real possibility of living 10 years by myself in retirement.

My numbers are probably pretty typical for many women. That means that we need to consider how much money we need to provide for those extra years – and also be across all the financial arrangements.

Q: How can women overcome the risk of running out of money in retirement?

NR: The most important thing they can do is calculate how much they’ll need.

The Association of Super Funds Australia (ASFA) retirement standard is just under $60,000 per year for a comfortable retirement. For a single, it’s $43,665. Another way to do it is to use a replacement rate: such as 70% of the income you were earning before you retired.

Once you have a figure in mind, you need to work out whether you’re on track to achieve it. To do this, you can project your current savings to calculate what level of income this will give you. Online tools can help with this, but the best way to be sure is to see a financial adviser.

If you’re not on track there are two main options: you can contribute more or work longer. Alternatively, you can reduce your expectations.

Q: When should women start planning for retirement?

NR: The biggest barrier to having enough money in retirement is simply not thinking about it early enough. People typically start thinking about retirement at around 50 or 55, or after certain life events – like paying off the mortgage or the kids’ finishing school.

But ideally, you should start planning in your 40s, if not earlier. Many people may be relying on working longer to save more, and then find that they can’t reach their retirement target because something happens.

About 20% of people have to stop work in their 60s due to ill health, while about half retire for reasons not of their own making, like sickness or redundancy. Some things will be out of your control, so that’s another reason for planning and being more conservative early on.

 Q: What advice would you give your three daughters to become financially secure?

NR: One of the key things is ensuring they have a career that can support them financially.

As a career mum, I used to think I should try to influence them to choose jobs that can be done flexibly – like, running their own business. But I’ve decided they should just do what they’re passionate about – there is no perfect solution for balancing work and family.

I try to raise them to be financially aware – one fun thing that they love doing is running a lemonade stand. We make them pay for the ingredients, so they learn about revenue and profit. Then they learn about marketing and promotion by selling the lemonade to passers-by.

But to ensure lifelong financial security, my advice for them is the same as for anyone else: get financial advice, start planning early – and don’t leave it to your partner.

Get the right advice

Everyone’s financial circumstances and retirement goals are unique, so it’s best to speak with your financial adviser. They can talk you through your options and help you choose the right super strategy for your needs.

 About Nicolette Rubinsztein

Nicolette Rubinsztein is a non-executive director at UniSuper, OnePath Insurance. Class Limited, SuperEd and the Actuaries Institute. She is also the author of Not Guilty, a practical guide for women juggling a family and corporate career on how to find a genuine work/life balance. Nicolette and her husband Jonathan Rubinsztein have three children.