Four financial tips for moms

Get involved, save for retirement, consider investments with growth potential, and protect your legacy.

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For many mothers, family comes first, especially before finances. But just as you take care of your children, you need to take care of yourself. And that applies to financial matters.

“Mothers are busy,” says Ann Dowd, CFP®, a vice president at Fidelity and a mother of three. “And they often don’t put themselves, let alone finances, first. But we need to if we are going to help the ones we love.”

A big part of that is paying attention to your financial life. Did you know that nine out of ten women will have to manage their finances on their own at some point?1 They may leave the workforce to care for a sick family member, become divorced, or find themselves widowed.

Here are four quick financial tips for mothers—and really just about anyone.

1. Get involved in finances.

Whether your spouse handles the majority of family finances or you split the tasks, it’s a good idea to have a full picture of the family financial situation. At minimum, know what accounts you have and with whom. That includes bank and investment accounts, life insurance, mortgages, and loans. Make sure you know the account numbers and passwords, too.

2. Save for retirement.

Whether you are a stay-at-home or work-outside-the-home mom, saving for retirement is important. If you don’t work, consider a spousal IRA. This type of IRA allows non-wage-earning spouses to contribute up to $5,500 for 2016 to their own Roth IRA or traditional IRA, provided the other spouse is working and the couple files a joint federal income tax return. If you are working and have a 401(k) or other workplace retirement account, contribute as much as you can. Read Viewpoints: "IRAs: 8 things you may not know."

3. Invest your savings.

You’ve got to put your money to work for you. For example, let’s say you save $100 a month and you put it in the bank. You’re earning basically zero interest on that. So at the end of a year, you still have $100. Right? Inflation’s gone up, so you actually have $98 or something like that. If you put it in the market and say you’ll earn 5%, that $100 at the end of that year becomes $105. And then the $105 earns another 5% the next year, and so on. Over the course of 30 years, that becomes a much larger sum of money than the $100. Invest your money to make it work for you. Read Viewpoints: "Women investors: four tips."

4. Protect your legacy.

It is important to name beneficiaries on all your bank and investment accounts, including retirement plans, and create a will and health care proxy. Yes, it's an uncomfortable topic, but think of it this way: Do you really want someone else making these decisions for you? Read Viewpoints: "Five ways to protect what’s yours."

Learn more

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Views expressed are as of the date indicated and may change based on market and other conditions. Unless otherwise noted, the opinions provided are those of the speaker or author, as applicable, and not necessarily those of Fidelity Investments.

Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments.

Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.

1. National Center for Women and Retirement and the Gender Gap in Financial Literacy Study, 2012
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