Even if your original retirement plan is as a couple, it might be a good idea to consider the possibility that you could become a widow at some point during your retirement. According to statistics, 80% of women outlive their husbands by an average of 14 years. When you take these figures into consideration, you may possibly have a decade or more that you will have to live as a widow.
Outliving your husband is a real possibility, and for this reason, as a couple you should approach retirement planning with a combination of a couple of different strategies. The first thing that you’ll want to do is spend less than what you may have been planning. The average withdrawal rate is 4%, but this may be too much, especially considering the current state of the economy. It is a better option to evaluate your financial situation each year, and adjust your spending higher or lower according to your gains or losses.
Another strategy would be to invest about 80% of your retirement savings in stock. Although this may seem very aggressive, and a risk, you will likely have more income if your investments are paying dividends. Even during the economic crisis, people with dividend paying stock had income coming in from returns on their investment.
If possible, you will want to invest in a large number of companies instead of investing a big chunk of your money in only a couple. Divide your investment money between several companies that have solid growth potential. Some of these companies are brands that everyone is familiar with, such as Coca Cola, McDonalds, etc.
You won’t get rich with this strategy, but over the long term you will get returns, and there is little doubt that your investments will be safe. Many women prefer this type of investment strategy because it is safer than investing in mutual funds. When you invest in mutual funds, it can be difficult to know just how much growth you can expect in the future.
Planning for a secure income later with reliable investments is the best retirement plan for women.