Women Small Business Owners

It&#8217;s been said that &#8220;<i>failing to plan is planning to fail</i>.&#8221; This is an eternal truth when it comes to money, and especially so for women business owners. &#160;Why? &#160;Because for most, their business generates more than half of their household&#8217;s income and a significant portion of total net worth.&#160;&#160;Effectively planning and then allocating business income/capital are critical to the attainment of financial security. &#160;Since women are prone to certain financial risks at higher rates than men (e.g., longevity, lower lifetime earnings, disability, caregiving), planning is even more important. In general, the state of retirement preparedness among business owners is troubling. &#160;According to a recent study of 400 business owners by BMO Harris Wealth Management, three in four participants had less than $100,000 saved in retirement funds. Fewer than one in 10 had accumulated more than $500,000, which would be considered insufficient for many. Compounding the consequences of inadequate preparation is the possibility of early retirement due to unforeseen circumstances.A recent study from the Employee Benefit Research Institute found that almost half of Americans retire sooner than they planned. Of these, 56% cited health changes, disability and family caregiving as primary reasons. Just 24% stated they were able to afford earlier retirement and 10% said they wanted to do something else.&#160;&#160;Lesson learned? &#160;When planning for retirement (as with anything else), it&#8217;s important to consider both the upside and downside possibilities.

It’s been said that “failing to plan, is planning to fail.” This is an eternal truth when it comes to money, and especially so for women business owners.

Why? Because for most, their business generates more than half of their household’s income and a significant portion of their total net worth.  

Effectively planning and then allocating business income/capital is critical to the attainment of financial security. Since women are prone to certain financial risks at higher rates than men (e.g., longevity, lower lifetime earnings, disability, caregiving), planning is even more important.

In general, the state of retirement preparedness among business owners is troubling. According to a study of 400 business owners by BMO Harris Wealth Management, 75% of the participants had less than $100,000 saved in retirement funds. Fewer than 10% had accumulated more than $500,000 which would be considered insufficient for many.

Compounding the consequences of inadequate preparation is the possibility of early retirement due to unforeseen circumstances.

A study from the Employee Benefit Research Institute found that almost 50% of Americans retire sooner than they planned. Of these, 56% cited health changes, disability and family caregiving as primary reasons. Just 24% stated they were able to afford earlier retirement and 10% said they wanted to do something else.

Lesson learned? When planning for retirement (as with anything else), it’s important to consider both the upside and downside possibilities.

Many women business owners are pre-occupied with meeting the needs of the “here and now” like cash flow and accumulation of reserves. Others plow everything back into the business, sometimes not even taking personal income let alone putting money aside for retirement.

Without good planning, retirement can just be an abstract concept. With the pressures of the business, it can be hard to separate oneself from the tangible “here and now” to plan for an intangible concept such as retirement.

We will help you to be comfortable enough managing your finances so that you do not need us anymore. However, we are here if you do. That is true financial independence.

Engaging with a Financial Advisory firm such as Gowdy Financial Group, LLC., will help ensure you will have the financial security tomorrow to enjoy each stage of your life.

Our services include:

  • Budgeting
  • Financial Planning
  • Retirement Planning
  • College Planning
  • Tax Planning
  • Estate Planning
  • Debt Management
  • Credit Restoration
  • Insurance Planning
  • Investment Planning
  • Small Business Loans
Client Centered

A survey by the U.S. Chamber of Commerce found that the pandemic-induced economic downturn has disproportionately affected women-owned businesses. Some are still trying to recoup lost profits and clientele.

An Associated Press report showed that American small businesses have had an especially rough time. According to the U.S. Small Business Administration, many of the small businesses were owned by women.

Many small business owners, who work in the consumer services sector which includes hair and nail salons, are not only entrepreneurs, they are also mothers and the head of the household.

If you haven't already taken some time to clearly define your financial goals, don't put it off any longer. Well-defined goals are imperative for creating an effective financial strategy. 

If you'd like help setting your financial goals, please click on the link below to schedule a free, 30 minute consultation.