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Retirement planning for men vs. women

When it comes to retirement planning, both men and women have big responsibilities — and big differences. Those differences exist in large part because of the gap in life expectancy. In the U.S., the average life expectancy for women is 81.1 years; for men, it's just 76.2 years.[1]

As a result, Jenny Smith, a West Des Moines, Iowa-based financial professional with the Principal Financial Group, recommends:

Choose distribution options carefully.

When choosing payout options for 401(k) plans, pension plans or other retirement accounts, make sure benefits can pass through to the surviving spouse.

"There are choices out there that would lock up the money and have it die with the husband," Smith explains. "If, for instance, the husband selects a pension payout for his life alone and he passes away first, the bulk of the couple's income dies with him. And once this option is chosen, you can't go back and change it," says Smith.

Women need to save aggressively.

Since women live longer, they need to fund more years of retirement. What makes this even more challenging is the fact that women tend to earn less than men — in part because many women take time out of the workforce to raise children.

Both partners need to understand the family's finances.

Traditionally, men manage the money in most families. But women should be just as involved. "Women, in many cases, will at some point live alone," says Smith. "That's why it's really important that they understand the finances in general."

"Also," Smith continues, "finances get more complicated with age instead of easier. During retirement, you have multiple income streams — money coming in from all kinds of different places like Social Security, pension plans and investments. So later in life, not only do many women have to manage money for the first time but also when it's the most difficult."

Start planning for retirement early.

Aside from saving for retirement, which should start in your 20s, Smith recommends people start preparing financially for their actual retirement as early as 15 years before retiring. "Asset repositioning strategies — getting the money in the right places so you know you can get income out of it — can take time," she says.

Talk to a professional.

Regardless of your gender, get advice, says Smith. "Visit with a financial professional, and give him or her the whole story. If you're embarrassed because you don't think you've saved enough, that's all the more reason to get professional guidance."


Centers for Disease Control, Deaths, Preliminary Data for 2010.

Jenny Smith is a Registered Representative of Princor Financial Services Corp., 1.800.547.7754, Member SIPC, Des Moines, IA 50392.

Insurance products and plan administrative services are provided by Principal Life Insurance Company. Securities are offered through Princor Financial Services Corporation, 1.800.547.7754, Member SIPC and/or independent broker dealers. Securities sold by a Princor® Registered Representative are offered through Princor. Princor and Principal Life are members of the Principal Financial Group® (The Principal®), Des Moines, IA 50392.


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