Women and Wealth: What to Consider in Your Financial Planning

Women make up half the population but for so long have been treated like a niche demographic in financial services. Today, women are largely responsible for their families’ financial decision-making, and hold the majority of consumer spending power. They’re anything but a niche.

Despite systemic obstacles, women have become a true financial force, controlling more than $10 trillion in U.S. household financial assets. By 2030, analysts expect that figure to triple, thanks in large part to the coming wave of intergenerational wealth transfer from Baby Boomers to succeeding generations.¹ That’s a lot of assets in female hands.

With that kind of economic power, women should be on top of their financial lives. That’s not usually the case, especially inthe wake of a pandemic and its accompanying economic fallout, which disproportionately affected women.

As of late 2022, women had a median of $2,400 in emergency savings, compared to $9,000 saved by men.² About a third of women surveyed in 2024 said they did not believe their retirement income or savings would be enough to pay their monthly bills.³

These numbers are disheartening and illustrate the need for a focus on women by the financial services industry. On an individual level, we can start to turn the tide through education, goalsetting, and planning.

Planning for the Challenges Women Face

Women’s needs and obligations often differ from those of men, so we should be having candid conversations about money acknowledging that fact.

For one, women provide a disproportionate amount of caregiving in the U.S.,⁴ and much of this labor is not only unpaid but may also lead to a reduction in income. For instance, we may put our careers on hold or reduce our working hours to care for children and/or aging parents.

Spending less time in the workforce can have far-reaching financial effects, in some cases preventing participation in company-sponsored retirement plans or preventing a smooth career trajectory and the pay increases that come with it.

On average, women live about five years longer than men,⁵ meaning many of us outlive our male partners. Because of the career interruptions I just mentioned, that means many women are living longer on less income. It also means they’ll need to be able to make financial decisions on their own.

Finally, women may not be taking full advantage of the investment opportunities at their disposal, or the potential for their assets to grow, as they are less likely to participate in the stock market.⁶

Setting and Meeting Goals

It helps to think about money as a vehicle for realizing your personal vision of success. The stakes are too high not to take control of your finances, and thoughtful planning, you can garner the financial freedom to pursue your dreams, bring stability to your life and the lives of your loved ones, handle the inevitable obstacles life throws in your path, and contribute to the causes close to your heart.

That all sounds great, but how do you get started? There are a few basic steps for developing a money management strategy.

First, define your goals. If you have a partner, you can do this step together. Some of the things you’ll want to consider are the personal and professional milestones you hope to achieve in the short and long term. Of course, you’ll do that with an understanding that there are sometimes events beyond our control that can temporarily send you off course, but these are the north stars you’ll continue to sail toward. During this process, you might ask yourself what being financially comfortable means to you. Even if it seems far away, you should begin to think about what an ideal retirement will look like, whether it’s traveling the world or moving close to your grandchildren.

With your goals articulated, a sound next step is to come up with a saving and investment strategy, keeping in mind that it may very well change over time. One place to start is with any financial wellness resources available to you at work, such as financial planning, money coaching, or educational programming. Such benefits are on the rise, -.with more than 70% of employers now offering some financial wellness benefits to workers.7

In addition, for many people, working with a Financial Advisor is a great way to get help creating and implementing a wealth plan that takes your specific goals and circumstances into account at each stage of your financial journey.

Get your family involved in this planning as well. With your partner, be honest about financial values and fears. Level-set on goals and expectations for retirement. And be sure you have information about and access to one another’s financial documents and accounts, so you’re prepared if something should happen to one of you.

If you have kids, talk to them about money, too. You might discuss values around money, what their definition of success looks like—understanding it may differ from yours—and how they may be able to use their resources to affect positive change. Also get them thinking about important concepts like credit, budgeting and starting to save and invest early.

Preparing for the Expected and the Unexpected

No matter how carefully you plan, life will throw you a curveball at some point. Case in point, the COVID pandemic upended the financial plans for many investors. Additionally, a change in employment, an accident or illness, or the loss of a loved one can take a major financial toll on top of the physical and emotional trauma of such an event.

In the short term, work toward building an emergency fund in a liquid account, which could cover at least three to six months’ worth of essential living expenses if you find yourself short on income. If you work in an industry that’s particularly vulnerable to economic downturns, you might consider aiming for an even more savings. You can start small and build up this fund over time.

Depending on your age, estate planning may or may not be top-of-mind, but one of the best ways you can care for your family is to get your financial affairs in order. Proper estate planning, such as having a will and other important documents in place, can help you manage estate taxation, help ensure your assets will go to the intended beneficiaries and minimize family turmoil.

When it comes to healthcare, plan for the best but prepare for the worst-case scenario. You can do this by making sure your health insurance plan covers the essentials, considering life and disability insurance policies, getting important legal documents in place (including a healthcare proxy and medical directives), and factoring the long-term cost of healthcare into your overall wealth management strategy.

The Bottom Line

It’s natural to feel overwhelmed when preparing for life events. But taking control of your finances can propel you in so many other areas of your life. You owe it to yourself to define your goals, start a dialogue with your loved ones and create a game plan. The modern face of wealth is female, so walk confidently into your financial future.

Learn more about how you can work with a Morgan Stanley Financial Advisor to identify financial goals and build a customized wealth plan to help you reach them—or find one in your community.

A version of this article originally appeared on MarketWatch (“How to plan for the unique financial challenges women face,” March 23, 2020).