Girl talk about MONEY

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Do you know how much money you have saved for a rainy day ... or for retirement ... or for life? Single or married ... You have to be actively involved in your financial preparations for retirement. There are two main reasons I am telling you this:

1. You have a longer life expectancy than your hubby. We typically outlive men by about seven years, according to the U.S. National Center for Health Statistics, and more years of life mean more expenses.

2. There is a big chance you have less money in your retirement plan. Because of who we are, we drop out of the workforce for an average of 12 years to care for our young children or aging parents, according to the Older Women's League, a research and advocacy group. This time away from the workforce results in us accumulating much less money in our employer-sponsored retirement plans, such as 401(k)s.

Fortunately, there's a lot we can do to avoid this fate. First of all, make it your business to know what's going on in your financial situation. Don't assume your betrothed has all of the answers on this one. Trust me. If you are married, share the responsibility of making investment decisions. What are your retirement goals? Are the two of you investing enough to eventually achieve these goals? And where is the money going? You must know the answers to these questions.

You'll also need to know what you could expect to receive if your hubby dies before you. As a surviving spouse, you will likely inherit all of your husband's assets, unless he has specifically named other people -- such as grown children from an earlier marriage -- as beneficiaries.

Isn't this something you are going to want to know the answer to? You can't just assume that all sources of income that your husband receives will automatically roll over to you. For example, if your husband were to die before you, you wouldn't get his Social Security payments in addition to your own, although you could choose to collect his payments instead of yours. But if you both earned close to the same income, you might not get much of an increase in Social Security benefits.

In any case, whether you're married or single, here are a few smooth moves that can benefit you:


1. Max out on your 401(k). If you can afford it, invest the maximum amount into your 401(k) and increase your contributions every time your salary goes up. Your 401(k) provides you with tax-deferred earnings and a variety of investment options.

2. Contribute to an IRA. Even if you have a 401(k) or other employer-sponsored retirement plan, you might be eligible to contribute to a traditional or Roth IRA. A traditional IRA offers the potential for tax-deferred earnings, while a Roth IRA potentially grows tax-free, provided you don't take withdrawals until you're 59-1/2 and you've had your account at least five years. You can fund an IRA with virtually any investment you choose.

So I will repeat myself, ladies: Do whatever it takes to ensure a comfortable retirement.


Joellen Nelson has been a financial adviser with Edward Jones Investments in North East since 2001. This is her first article for Her Times.