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Data & Research July 27, 2010
Women More Aware of Need for Financial Help
The 10th anniversary edition of Prudential’s Financial Experience & Behaviors Among Women finds the economic crisis has heightened women’s recognition of the need to develop a financial plan that will meet long-term financial goals.
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However, according to the study report, just one-third of women have a detailed financial plan and, among the youngest segment (ages 25-34), just one in 10 has such a plan. Barriers to developing a detailed financial plan respondents cited include lack of time, the pull to meet shorter-term financial obligations, lack of knowledge, and for many, an unmet desire for assistance and help.
Although a majority of women (55%) now believe they will need to work longer than they expected, and, as a result, postpone their retirement, three-fourths believe they are financially on track to meet their long-term goals, or are well-positioned to catch up.
However, many women still lack confidence in their ability to make sound financial decisions, and lack knowledge about sophisticated financial products. Fewer than two in 10 women feel “very prepared” to make wise financial decisions. Half indicate that they “need some help,” and one-third feel they “need a lot of help.”
Nearly nine in 10 of those who are looking for a lot of help need guidance on how to choose financial products that meet their needs. They say their knowledge of annuities, mutual funds, and individual securities is limited.
More than half of those surveyed are very willing to have retirement planning decisions made by others, but this wish is often complicated by a lack of trust, as only 19% are very comfortable letting a financial professional lead their financial planning. Over six in 10 rely on family and friends, rather than financial professionals, for investment information.
However, those who currently use financial advisers are more likely to feel that they are financially on track than those who go it alone.
Among the women surveyed, 95% indicate they are directly involved in their households’ financial decisionmaking; 25% are the primary decisionmakers. Eighty-four percent of married women say they are involved in financial and retirement planning and, of these, 15% have sole responsibility.
For the 10th anniversary study, 1,250 American women were polled. The survey was administered from February 10-26, 2010.
The study report is here.