Hispanic, Asian and Indian women-between the ages of 35 and 55, with incomes between $25,000 and $35,000, use a financial planner.
But there are advantages to enlisting the help of an expert, especially in terms of planning ahead for major financial events. Laura Poynter found this out when she was forced to empty her 401(k) account to scrape up the down payment for her co-op apartment in New York. At 34, she was tired of renting and wanted to buy a home for herself and her four-year-old daughter, Aillanna Eyssallenne. “I didn’t have an emergency fund, and in terms of savings, I’m basically living hand to mouth. I’m back to ground zero.”
The good news is that Poynter has no other debt outside of her impending mortgage. As a first-time homebuyer, she’s excused from the 10% penalty on any 401(k) withdrawal not taken during retirement. In addition, real estate could provide a handsome return in the future.
“Women must buy their own homes or invest in some type of property,” says Broussard. She cites studies of the differences in net worth in black ($4,000) vs. white ($40,000) households, “because of the lack of property in black households. Having your own home is a form of wealth building.”
There are a number of ways you can find a reputable planner. (Start by taking a look at “The Right Stuff” in the May 1999 issue of be). Aside from www.wfn.com, which helps you access female advisors, the Website of the National Association of Personal Financial Advisors (www.napfa.org) will help you find a fee-only financial planner or CPA near you. In conjunction with Dalbar, a Boston-based financial research firm, MSN Money Central’s advisor finder at www.therightadvisor.com lets you search for a planner by location and portfolio range. In addition, the Certified Financial Planners Board of Standards’ site at www.cfp-board.org lists planners by category, such as “Financial Planning for Women” and “Financial Planning for Low Income Clients.” In the Press section, click on “Media Sources” for a complete list.
Not quite sure if you want to put your financial life in someone else’s hands? Howard has split the difference by investing 50% of her money in stocks she picks on her own and actively manages online. The other 50% is managed by Charles Schwab investors, who have set aside a portion of Howard’s money for her retirement and put the rest in a cash management fund “to simulate a salary” while Howard is getting her writing career off the ground.
If you’re definitely a do-it-yourselfer, there are plenty of cyber tools to help you create your own financial plan. For instance, www.financecenter .com has a smorgasbord of savings calculators and budgeting tools to help you estimate your needs for everything from buying a car to planning for retirement. Vanguard’s Website at www .vanguard.com/educ/inveduc .html offers a variety of free tools as well. If you feel you need more guidance, you can use one of the four interactive investment modules at www.van guard.com/planning center/ software/software.html.
GET STARTED: PAY YOURSELF FIRST