3 steps to reduce your stress about money

April 23, 2021

Women are stressed about money, thanks in no small part to the Covid-19 pandemic. That's according to a recent survey by Fidelity, which found that 70% of women are stressed about their long-term savings and investments.

Fidelity surveyed 1,902 U.S. adults, including 951 women, and aimed to explore the financial impacts the Covid-19 pandemic has had on women.

Overall, 60% of women respondents say they have been much more stressed during the pandemic, with a range of factors contributing to their stress. These factors include the emotional and mental well-being of their children, everyday finances and long-term savings.

Additionally, nearly 40% of women are considering scaling back their hours or leaving the workforce due to their increased caretaking responsibilities, the survey found.

That being said, many women are taking steps to take control of their finances. Fidelity saw a 41% increase in women who sought out Fidelity's services on their own, rather than through their employer, compared to the previous year.

In order to help clients manage their finances and reduce their money-related stress, Fidelity recommends taking three key steps.

1. Build up emergency savings

2. Aim to save more than 10% of your salary for retirement

It is never too early to plan for retirement. Contributing to an employer-sponsored 401(k) plan allows you to put away a portion of your salary now and defer paying taxes on those savings until you withdraw them during retirement. It's also likely that your employer will offer you a match on a certain percentage of your contributions, which is essentially free money.

If you aren't able to save the recommended 15% of your salary right away, start with what you can put away. But aim to work your way up to saving at least 10% of your income.

Women who are saving 10% of their salary or more felt less stressed about their financial futures, Kapusta says. And saving 15% of your salary throughout your career should help you hit the recommended target of having 10 times your salary saved for retirement, Kapusta adds.

If you do not have access to an employer-sponsored 401(k) plan, there are other retirement savings accounts that can help you plan for the future and get tax benefits, such as traditional or Roth IRAs.

3. Create a roadmap for your goals