How Working Mothers Can Protect Their Wealth
Saving money as a working mother can feel almost impossible. But you can protect your wealth by taking small, necessary steps toward financial independence. Whether you’re a single mom or have help from a partner or family member, there are ways to put money away for the future.
5 Ways to Protect Your Wealth as a Working Mom
One of the most essential components of any wealth management plan is wealth preservation. If you want to protect your wealth and pass it on successfully to your family, keep reading.
1. Retitle Your Assets
If you have large assets, like homes, vehicles, or retirement plans, you should retitle them. When you retitle your assets, you protect them from forfeiture if your or your assets are in a legal dispute. By simply removing your name, you can protect most of your properties.
If you’re married, you can title your assets as tenants-by-the-entirety in some states with a spouse. Under this ownership type, the surviving spouse becomes the sole owner of the asset when the other spouse passes away and is exempt from paying debts and other liabilities.
2. Write a Will and Trust
You may feel your retirement years are far off. While that’s typically true, that doesn’t mean you shouldn’t prepare for them with a will and trust. Getting a will while you’re young is vital because it labels a beneficiary that will care for your children and your assets after death.
When paired with a trust, a will can designate the terms for the trustee’s management of the assets. That’s because the purpose of a trust is for estate planning. However, if you don’t wish to give all of your assets to your family, you can also use your trust to give to charity.
In the end, irrevocable trusts and asset protection trusts can ensure your assets are seized by creditors, even if you declare yourself the sole beneficiary, as long as they aren’t distributed.
3. Get a Life Insurance Policy
Life insurance is another thing most young people don’t consider as necessary until they’re older. However, life insurance can ensure your children and other family members have their bills covered and their college paid for if you die. Insurance can also minimize transfer taxes.
You can also buy life insurance for your children. No mother ever wants to think about collecting death benefits for their child, but if it were to happen, these benefits could ease the stress of a devastating time. On a more positive note, permanent life insurance can lock in their insurability.
4. General Financial Planning
It will be challenging to reach your financial goals without a solid financial plan. A financial plan is a summary of your financial goals and the strategies designed to achieve them. Think of it as your financial roadmap. You can either create a plan yourself or with a financial planner. Check out Invested Mom for improving your financial literacy and building wealth.
Most financial planners will recommend several financial strategies, which include retirement planning, education savings, investment advice and management, estate planning and trust services, and pension decisions. You’ll receive tips on the best ways to save money.
Working moms who decide to partner with a financial planner are more likely to meet their goals because they’re provided with designated timelines and opportunities to adjust their plans.
5. Investments and Securities
No matter how much you make, working moms can protect their wealth by investing in multiple types of securities, like stocks and bonds. If you’re a young mom, you can take more risks on the stock market, but if you’re in your 40s, consider putting more money into government bonds.
Investing in real estate is one of the best ways to build and protect wealth, and you don’t even have to buy a house to get started. You could invest in a real estate investment trust (REIT) or use online real estate platforms to crowdfund a bigger commercial or residential deal.
Now go out there and take on the future ladies!