Making Cents: Women may need to plan for long lives

John P. Napolitano

The basics of financial planning are essentially the same for males and females. However, there are some aspects of financial planning that have greater impact on women than on men, regardless of marital status or profession.

The first is life expectancy. In general, women have a longer life expectancy than men. This natural longevity advantage, coupled with family history and lifestyle, could necessitate planning for an extended life expectancy. A woman's money may need to last longer than the money of a male counterpart. Should that influence how you invest or how much you spend, or both?

One could argue that there's a greater need for the types of longevity protection offered through insurance products.

Long-term-care insurance is one example. Living well past life expectancy creates a greater likelihood of being alone significantly longer. I do not recommend a spouse at home as the long-term care giver for a spouse, but many do end up in that role anyway. If the odds are that the woman will live longer, then perhaps long-term-care coverage is worth considering.

Annuities are another financial product created by insurers that are designed primarily to provide for retirement. Annuities are used to accumulate assets for retirement years and to produce an income stream that cannot be outlived.

Planning for Social Security may also present an entirely different opportunity for long-lived women. In general, the longer you wait to take Social Security benefit payments, the larger that amount gets, until age 70. For the person who lives 10 to 12 years past age 70, waiting frequently produces a larger total benefit than taking a reduced amount of Social Security any time between the ages of 62 and 70. For the woman who lives well beyond age 82, each month's payment just makes the benefit from waiting better.

Depending on the family, the loss of a spouse may cause other problems.

A common void for many women after the loss of a husband is in the area of home maintenance. The husband may have performed a long list of upkeep chores. It is wise to understand that your cost of living without your male spouse may not drop as much as you expect, because of the services you may now need to pay for.

John P. Napolitano is CEO of U.S. Wealth Management in Braintree, Mass., and 2012 president of the Financial Planning Association of Massachusetts. He may be reached at or on Facebook as JohnPNapolitano.