By Douglas Goldstein, CFP®

Regardless of the more modern way people look at gender, there are significant differences in how men and women should invest their money.

Here’s why:

Women’s pensions tend to be smaller

Women’s pension payouts tend to be lower than men’s payouts, because most women work fewer hours and have lower salaries than their male counterparts. Even though “paternity leave” is becoming more common, most women still take additional non-paid time after having a baby. And, when they return to work, they may return to a part-time position. All this means a lower salary, and a proportionately lower contribution to a pension fund.

Women live longer than men

In Israel, the average lifespan of a man is 81 years, while a woman’s life expectancy is 84. In the United States, average life expectancy for a man is 76 and for a woman 81. As women generally retire earlier than men and live longer, this means a lengthier retirement and more bills. Furthermore, if a pension doesn’t increase with inflation, then the real value of the pension may not be the same towards the end of retirement as during the beginning of retirement.

Essentially, this means that women have fewer resources to cover a longer time period. Since women tend to outlive their spouses, they need to master enough financial skills so they can take care of themselves, and need to be even more careful than men about financial planning. If nothing else, women need to be sure that regular savings are an integral part of their monthly budget during their working years.

Start planning for retirement now

If you have not yet started planning for retirement, call your financial advisor today and start working on a plan. If you are a woman and have any questions about personal finance, send me an email at: [email protected]. If you are a man, give this article to the women (spouse, mother, daughter) in your life to read.

Douglas Goldstein, CFP®, is the director of Profile Investment Services, Ltd. www.profile-financial.com. He is a licensed financial professional both in the U.S, and Israel. Call (02) 624-2788 for a consultation about handling your U.S. investments from Israel. Securities offered through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates.