First Person: Protecting My Retirement From the '7/11 Effect'

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Financial experts call it the "7/11 Effect." Women live 7 years longer than men, and spend, on average, 11 fewer years in the workforce. Women also earn 77 cents for every dollar earned by a man. Because of this so-called 7/11 effect, most women have half the retirement savings compared to men. I came up with a few simple strategies to boost my retirement savings so I won't be left clipping coupons while my male peers are out golfing.

Spending less time in the workforce

I can relate to the 7/11 concept because I worked at home to be with my children when they were younger. I may also drop out of the workforce early to take care of elderly relatives. My strategy for fighting this statistic is to earn money working out of the home. By working at my own business, I will have a more flexible schedule. And, I'll be happier working longer into my retirement years.

Living longer than men

Instead of taking up smoking so I don't live as long, I came up with strategies to compensate for the 7/11 effect on my finances as a female. I am careful to max out my Roth IRA so I will have tax free retirement money to spend when I'm older. We also pay off our mortgage early so we can live in our same house even if our income changes or if Social Security payments disappear. I want to have fewer expenses during retirement.

Earning less than men

Although most women make less money than men, I try to boost my income with freelance work. I also compensate for a lower income by becoming educated on investing. I trade stocks as well as options to produce investment income over the long term. As a woman I have different financial concerns compared to my husband. I've watched relatives and friends lose their husbands years before they reached retirement age.

Because the financial future is so unpredictable I stay out of consumer debt and live below my means.

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