HOME LOANS, BANKS, STOCKS AND INVESTING
By Amit R. Patel

Households headed by women who are unmarried or not living with a partner have far fewer financial resources than the average U.S. household. According to a recent study by the Consumer Federation of America (CFA), they have a much lower net worth and lower incomes, which generally can be attributed to less education, less likelihood of being employed and having only one paycheck instead of two. (Source: CNN/Money, Jan 12, 2004)
To make matters worse, according to a recent report from the Employee Benefit Research Institute, older, low-income, single women will have meager Social Security benefits and insufficient 401(k) plan balances for their retirement. (Source: CBS Marketwatch, Dec. 17, 2003)
The following recommendations are geared toward women-headed households but also are applicable for others who are lagging in their savings and are struggling with financial challenges:
Prepare a Budget – Know how much money comes in and goes out of your household each month to make educated financial decisions.
Build a Credit History – Before the need arises, you should have at least one credit card in your own name and use it on a regular basis.
Create Systems to Boost Your Savings – Take advantage of savings opportunities, such as automated savings programs at work, particularly if they offer matching funds from an employer, such as a 401(k). Create a liquid emergency savings fund to cover three to six months of living expenses.
Make Lifestyle Changes – Do you overspend on credit cards? Has your debt been consistently increasing? Are you driving a car that you really can’t afford? Consider small and large changes to help you reach your short- and long-term goals.
Determine Social Security Benefits – This is especially important for divorced women who were married for at least 10 years and who are entitled to certain benefit rights from their former spouse’s Social Security record.
Consider Delaying Retirement – Delaying retirement will allow your nest egg to continue to grow, and insurance benefits can pick up what Medicare won’t. Secondly, if you can delay withdrawals from tax-deferred benefit plans, your money has more time to grow tax-free Social Security benefits also increase for every month past your full retirement age that you keep working.
Get Help – Seek help from a qualified financial advisor who can help you create a comprehensive financial plan specific to your needs and goals.
Amit R. Patel is a financial advisor located in Pasadena that specializes in taxes, retirement, estate planning, risk protection and investments. He is a financial planner, chartered financial consultant and registered representative of American Express Financial Advisors, and is licensed in securities, variable annuities and long-term care insurance. For more information, please call 626/795-1267 or visit him on our website at sanmarinotribune.com