And yet, do women feel empowered when it comes to their finances? Some common concerns I hear from women in my practice as a financial advisor are: I don't want a second career managing my finances; numbers make my eyes glaze over; how do I balance saving for my children's education with saving for my retirement? The common themes of no time, no interest, no confidence and no clarity impede many women from taking control of their financial future.

My fellow Phi Mu sisters, you need to focus on your finances now more than ever. Here are some common "cents" reasons you cannot afford not to:

Reason # 1
Taking time out of the workforce results in cumulatively higher financial losses for women.
Lower pension payments, social security, annual income, assets in a 401(k) and life insurance are all negatively impacted by taking time off from the workforce. Whether it’s to care for a child or aging parent or finding themselves suddenly single, women in general tend not to have the same work lives as men do. These situations can set women back as far as lifestyle and retirement goals are concerned.

Reason # 2
Women live longer than men, needing more savings for sustainability. On average, women live seven years longer than men. Research shows that women are not on track to establish the sources of income that will sustain even a moderate lifestyle through this longevity.²

Reason # 3
Nine out of ten women will be solely responsible for their finances at some point in their lives. The average age at which most women become widowed is 56. That means that women must find ways to support themselves potentially for decades after losing a spouse. With life expectancy for women now 80 years, the average woman is single for about 2/3 of her life.³

Reason # 4
Health care costs are rising exponentially. Healthcare spending and healthcare costs are rising faster than the annual rate of inflation. The average rate for annual inflation is 2.5%; for healthcare spending it is 6.9% and 7.7% for healthcare insurance.⁴ (Consumer Price Index, 12-month average, 2006.)

Reason # 5
Women invest more conservatively than men. Women are more risk-averse in their financial portfolios than men, investing less in higher risk asset classes, like stocks. Women need to understand the risks of not investing wisely, especially of not investing enough to build in adequate growth to see them through their retirement years.

Due to this past year’s unprecedented events and volatility, I need to add:

Reason # 6
The current market turmoil. The collapse of the subprime market, the severe credit crunch, falling home prices, rising energy prices and an uptick in unemployment, make us feel vulnerable and scared. So you may be asking, “What do I do now?”

While you cannot control the ups and downs of the market, I encourage you to focus on what you can control -- your financial plan. Here is some “sisterly” advice on what you can do today:

• Keep a spending diary. Track every cent you spend for a week. You may be surprised by the places your hard-earned cash is going.
  
  
• Have a comprehensive financial plan and stick to a diversified portfolio. Extreme shifts in your portfolio allocation can actually introduce risk rather than reduce it. Having a diversified portfolio takes the emotion out of the financial equation.
  
  
• Review your portfolio regularly and stay defensive. Investment portfolios may need to be balanced across asset classes and sectors. For example, an underweight in some areas, like financials, automotive and cyclical sectors and an overweight in others, like consumer staples, healthcare and telecommunications, may need to be adjusted to help you stay on course.
  
  
• Embrace investing and maximize tax-deferred saving in IRAs, 401(k)s and other retirement accounts. Factor in your life-expectancy when planning for retirement savings.
  
  
• As appropriate, consider investing in municipal bonds. Municipal bonds are currently trading at almost 150% of the yield for comparable Treasury bonds, whereas historically it has been around 85%.
  
  
• Work with an expert to help you develop an investment strategy that’s right for you. A financial advisor can provide you with keen insights on the array of investment possibilities, among other financial needs.
  

While this is one of the worst periods in the financial market by historical standards, it’s not unprecedented. Periodic purges in the financial system may be gut-wrenching, but they’re normal and to be expected. While there is an urge to withdraw from the markets until things have settled down, there is some confidence among policymakers that the problem is being resolved on a global basis and the markets have shown some indication of rebound. Taking control of your finances will help you feel better about yourself today and your future. Take my word for it -- just some “big sis” advice.

This article has been written and provided by UBS Financial Services Inc., for use by its Financial Advisors.

For more information, please contact:

Jan Holland Townes
First Vice President - Investments
UBS Financial Services Inc.
jan.townes@ubs.com
601-206-5119 or toll free 800-243-7228

_{¹ US Department of Labor, Bureau of Labor Statistics, Employment and Earnings, 2007.
²Social Security Administration, 2006; US Department of Labor; Institute for Women’s Policy Research, 2006.
³Annuity 2000 Mortality Table, Society of Actuaries.
⁴Annual inflation rate based on Consumer Price Index, 12-month average, 2006; health care spending based on 2005 rates from the Department of Health and Human Services, released in 2007; and health care insurance rates based on Employee Health Benefits: 2006 Annual Survey, The Henry J. Kaiser Family Foundation.}