Prudential business leaders reflect on findings from women's study
Our eighth biennial study on the "Financial Experience & Behaviors Among Women" uncovers optimism about recovering markets and encouraging short-term improvements, but troubling long-term trends.
With the economy and financial markets continuing to improve, women appear to be less worried about their financial security than they were in the immediate aftermath of the 2008 financial crisis.
Women still have a number of identifiable financial goals, of course. High on their list: having enough money to maintain their lifestyle throughout retirement, to cover health care expenses and to reduce personal debt. They also don't want to become a financial burden to loved ones or outlive their savings. And they define financial success as achieving a comfortable, financially secure retirement. The difference is simply that they no longer attach as high a degree of importance to these goals as they did a few years ago.
Nonetheless, women we surveyed feel no more prepared to make wise financial decisions today than they did two years ago or even a decade ago. Nor has their understanding of financial and insurance products improved. Not surprisingly, the Confidence Gap—our measure of women's confidence in their ability to achieve their financial goals—has not improved over that 10-year span, either.
Despite these findings, women—like men—still do not tend to seek out financial professionals to help them achieve their goals. This is particularly concerning given that women increasingly are making the financial decisions in their households. Nearly half of women—44 percent—are the primary breadwinners in their households, and 27 percent of married women now say they "take control" of financial and retirement planning and manage it themselves, up from 14 percent in 2006.
One of the biggest perceived impediments to reaching financial goals is not having enough disposable income to dedicate toward them, cited by about half of women. But they also admit to a lack of familiarity with financial products and the sense that they simply don't know what to consider when evaluating their options.
While the survey paints a troubling picture of their long-term financial preparedness, the results indicate that women are more confident in their ability to manage day-to-day finances. And they have advice for financial services firms about how to help them achieve their long-term financial goals: simplify the process, stop using so much jargon, look out for the customer's interests, and maintain a strong code of ethics.
At Prudential, we remain steadfast in our commitment to improve women's financial literacy, and to develop innovative tools and resources to help them create a clear path toward a more secure retirement.