A recent study conducted by the insurance and investment company Prudential found that, while a majority of women are taking an active role in household financial decisions, they admit there’s still work to be done when it comes to the knowledge needed for long-term financial planning.  The study found that a whopping 95% of women surveyed said they’re involved in household financial decisions, with a quarter of the women acting as the primary decision-makers.  However, half of the women surveyed said they need help when it comes to their ability to make wise financial decisions, with a third saying they need a lot of help.  What’s worse is that only two in ten women feel ‘very prepared’ to make wise financial decisions.

There are myriad reasons as to why women don’t feel confident making financial choices.  One expert says the reason women don’t think in the long term is because they “as a whole, spend all their time dealing with the day-to-day decisions: how do I get from today to tomorrow, from this week to next week, from this month to next month?”  These short term financial decisions derail women from thinking well into the future.  What’s more, women by far have longer life expectancies than men – females, on average, will live to about 80.2 years, and males will live to about 74.5 years.  Wives will statistically live eight to ten years longer than their husbands if they’re married at the same age, and over 75% of women will eventually be widowed.  If women will not only live longer than men, but also take more time away from their careers to birth and care for children, they definitely need to take hold of their financial futures.

We’ve compiled the biggest financial challenges that women face and offered suggestions and solutions for financial success.  One of the big challenges that women face is putting the needs of others before their own.  And while in most situations this act of altruism is praised, it can lead to financial despair in the future.  Think of the bigger picture when making financial decisions, like how it will affect you in the future.  If you’d like to fund your child’s education before your retirement, go half and half, and both parties will benefit.  Another challenge for women is spending money to compensate for emotional needs.  Much like eating to compensate for emotional needs, this will only end in a lack of savings and a bigger belly.  Find different outlets to cope with emotional suffering that won’t affect your pocketbook, like exercise, reading, or talking with family and friends.

Women’s naturally strong nesting instinct easily leads them to live in a home that’s too large or expensive.  As a result, women often place great importance on remaining in the home and paying off the mortgage.  Depending on your financial situation, there can be better options.  Consider these factors before deciding to pay off loans and remain in a costly home: tax brackets, the size of the client’s portfolio relative to the size of the loan, projected cash flow, the liquidity of assets, and what decision will be best for the client’s emotional situation.  Also, make sure you have an updated estate plan to avoid high costs and emotional burdens for your family and relatives.  Nobody likes to consider mortality, but it is better to prepare for the inevitable and keep relatives informed of your financial decisions.

With women’s uncertainty in making important financial decisions, it’s no surprise that one of the challenges they face is having an investment plan that doesn’t focus on their individual needs.  An investment plan should reflect your income, growth, tax bracket, and estate.  With that said, being too aggressive or too conservative with investments is also an issue, as well as holding on to them for too long.  Seeking out advisors that are experienced in financial planning can help in focusing your assets and investments in the right places, and managing them successfully.  And while these financial challenges can ultimately affect anyone, it’s important that women know the biggest challenges facing them, educate themselves on the solutions, and begin getting their hands dirty in their financial planning process.