07/15/2015 08:48 am ET Updated Dec 06, 2017

Ladies, Are You Prepared For Retirement?

Leading author says women shouldn't rely on their husbands.

Cary Carbonaro says many women are too conservative with their investments compared to men and are making mistakes that are hampering their retirement planning.

The financial planner, who's based in Florida and New York, is author of The Money Queen's Guide and says she's concerned about many older women relying on their husbands for their retirement future. She suggests they take on a more active role now. Speaking from experience, she says her own ex-husband didn't have her best financial interest at heart.

"Women don't focus enough on finances," Carbonaro says. "They think it's math, and it's difficult, and that the husband takes care of that. I don't want women to think like that. I want them to take care of it themselves and not to be afraid of it. I want to empower them."

Carbonaro says she's seen enough divorces, and has gone through her own divorce, to know how devastating it is financially and emotionally for women. She said many, including some of her clients, have made terrible financial decisions because of emotions, so all women must get with a financial planner.

"I want to make them aware of how to take emotions out of the decision and make smarter investments, and financial and life decisions, surrounding their money," Carbonaro says. "If they did, it would be better for everybody."

Of her female clients, Carbonaro says many in their 70s and 80s barely balanced a checkbook in their life. Those in their 50s and 60s worked and took a more active role in finances but not as much as those in their 30s and 40s. She says the younger women know the best.

"Millennials are ahead of the curve and know they have to take care of themselves," Carbonaro says. "I don't think there is any 20-year-old who thinks a guy is going to 'take care of me.'"

There are a lot of landmines for women in their 50s, and they need to avoid those pitfalls, she says. Even as many so look forward to retirement, some still get involved in landmines like Ponzi schemes and lose a lot of money.

"If they're retired or close to retirement, there are a lot of things could potentially derail them," she says. One women, who received more than $1 million in a divorce settlement, wanted to spend the money on a dream house on the beach, even though she couldn't afford it and needed the money for her retirement.

"She was totally freaking out about the divorce, but said she didn't care and wanted to make herself happy," Carbonaro says. "Now she can't afford it, is running out of money, and she either has to take tenants in or just sell it."

Another client who made $150,000 a year went through $1 million by spending it on a man in a destructive relationship in which he wanted expensive items like a $100,000 car. She went through most of her money and didn't stop until it was too late and he was in jail.

"She lost her home, filed for bankruptcy and went in a total downward spiral," Carbonaro says. "She had the world at her fingertips, a great job and was set for life. Then she made a bad decision regarding a guy."

To prevent these worst-case scenarios, Carbonaro says she urges women to get a second opinion on any major decisions they make involving money. That includes buying a house, buying a car, and especially with investing.

Carbonaro says most of her women clients are conservative in their investments, almost too conservative, in that they want to keep a large amount of cash.

"The problem is keeping all of that money in cash doesn't even keep up with inflation," she says. "The money sitting in the bank earning a quarter of a percent gets taxes, and if inflation goes up 3 percent, you're losing every single year you keep it in cash. They feel like it's safe, but I have to move them off the fence and explain what it's not the best thing."

She says it's important to have an emergency fund of cash, but some women want 75 percent or more of their money in cash. She says she has to explain to them how they will run out of money by doing that rather than keeping 5 to 10 percent of cash and investing the rest in stocks and bonds.

"They are way are more conservative than men," Carbonaro says. "Women hate to lose money, so they would rather not have the gain than fear losing it. Men like to roll the dice, or they know the market does well over time so when the market collapses and they stay in, it will eventually come back."

Rather than invest money in the market, many women prefer to buy real estate or gold as something they can "touch and feel" compared to the market because many don't understand it, she says. Husbands and wives should have a joint strategy, but the women should be prepared if the husband dies or if there's a divorce.

"Since women live longer than men, if you're single or married, you're potentially not going to be living with your spouse eventually," Carbonaro says. "So you make sure you have enough money regardless of what your spouse has."

To start, women must know their net worth. They need to know their assets such as a car, home, stocks, bonds or a business and compare that to their mortgage, car, leases, loans, credit cards and other debts.

"if you don't know what is coming in and going out and what you have, you can't do anything," Carbonaro says.

Second, women need to know how they're doing related to their age and income group and have an honest assessment done by a financial professional. Finally, they need to know what their goals are and set a target.

"If I'm 50 and I want to retire at 60, that's my goal, and I have to figure out what I can do to meet my spending goals and lifetime income goals by the time I am 60," she says. "I think most people say, 'I want to retire' and but don't know what that means and what the dollar number is and what they're going to spend. Let's say they're going to retire at 60 and if you live to 95, you've got to cover a 35-year period. How much money do you need to do that? Very few can answer that question."

As part of this process for retirement, Carbonaro stresses the importance of a coach or advocate because it's not simple math. There are inflation-adjusted numbers and a lot of moving parts, she says.

"Once you have this in place," she says, "having somebody to help you means you can sleep better, have lower stress levels, and meet your goals once you have a plan in place and now how to get there."

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