Women are not necessarily well-prepared to manage the money coming towards them in the future.
Only 18% of retirement-age women passed a financial literacy quiz on making a nest egg last through retirement, compared with twice as many men who passed. The quiz was distributed by the American College of Financial Services, and found women had most difficulty in understanding annuity products, followed by company retirement plans and investment considerations. They did, however, know more than men about paying for long-term care expenses and equally understood Medicare insurance planning.
Women dont like talking about financial matters, said Leslie Thompson, managing principal at Spectrum Management Group in Indianapolis, Ind. I think women wish they knew more but theyre not asking the right questions and are intimidated regarding the whole process.
See: How women can save more money for retirement
Another problem: Women overestimated their financial smarts.
Though their scores werent high, their confidence on the matter was, the quiz shows. A third of women said they were extremely knowledgeable about retirement income planning, compared with 44% of men, and majority of women said they were extremely confident theyd have enough money to last them comfortably through retirement. (Only 24% of the extremely confident women passed the quiz.)
Not all women are happy about their money management, at least with their current assets 14% of women in a Transamerica Retirement survey of more than 4,000 workers said they felt theyve fully recovered from the Great Recession (compared with 25% of men), Theyre also not saving as much 83% of women in research from Aon Hewitt showed theyre not saving as much as they need for retirement, compared with 74% of men possibly because they didnt have the chance in their younger years. This could be a problem, considering women are about to control a massive amount of wealth $22 trillion by 2020, to be exact.
See also: Retirement checklist for women 7 simple tips to get you started
Women in need of catching up can do a few things, such as learning the basics of retirement assets, beginning to fund retirement accounts and talking with family members and significant others about important documents and financial information in the event of an emergency or death. They should also think about their goals (when theyd like to retire, and where). understanding potential expenses in retirement and creating a spending plan to stay in line with their goals. When theyre meeting with a financial adviser, especially if theyre with their spouse, they should engage more, Thompson said. They shouldnt be afraid to ask questions, she said.