Contents
- Empowering Women Investors
- Why It’s Crucial to Get Engaged Now
- The Widow’s Penalty: What Most People Miss
- What’s Your Social Security Plan?
- Long-Term Care Isn’t Just a Future Problem
- Thinking of Downsizing? Mind the Tax Window
- Divorced? Don’t Overlook These Benefits
- Start by Showing Up
- Let’s Build Confidence, Together
Empowering Women Investors
At REAP Financial, we love to empower the families we work with. But when it comes to retirement planning, we see a familiar pattern. One spouse, often the husband, is more engaged with investing and long-term strategy. The other, typically the wife, handles day-to-day budgeting or household finances.
This division of labor might work well for a time, but statistically, women tend to live longer. That means many may eventually find themselves navigating critical financial decisions alone. The earlier you get involved in your financial future, the more confident and prepared you may feel — especially when life throws the unexpected your way.
Why It’s Crucial to Get Engaged Now
We’re not saying you have to become an expert investor overnight. But we are saying it’s important to be involved.
If your spouse weren’t there tomorrow, would you know how to access your accounts? How much income you can reasonably draw? How your taxes might change?
These aren’t just theoretical questions. They’re the real-life scenarios we walk through daily with the women and families we serve. Being proactive now may help make all the difference.
The Widow’s Penalty: What Most People Miss
One of the biggest surprises we see among widows is how much their taxes may go up after losing a spouse.
It’s called the widow’s penalty. It occurs because, as a single filer, you move into a less favorable tax bracket — even if your income hasn’t changed. You might also face higher Medicare premiums, which are based on income, not assets.
If you’re relying on taxable retirement accounts, that bracket shift could result in thousands more in taxes each year simply due to filing status.
As a widow — or even as a divorced woman — your Social Security income strategy becomes critical. Should you take your own benefit or consider switching to a survivor’s benefit? What happens if your ex-spouse passes away? Are you eligible for their benefits?
Many people don’t realize how much flexibility is built into Social Security rules, especially for women who’ve been married for 10 or more years. The only way to potentially optimize your outcome is to understand your options ahead of time.
Long-Term Care Isn’t Just a Future Problem
Another concern that often catches people off guard is the cost of aging.
Home healthcare, assisted living, and nursing care can be incredibly expensive. When you’re on your own, these costs may deplete a portfolio quickly. Do you have a long-term care strategy in place? What assets might you use if you need care down the road?
These are not questions to delay. Planning ahead may provide more flexibility and peace of mind.
Thinking of Downsizing? Mind the Tax Window
If you’re widowed and living in a larger home, downsizing might be on your radar. But there’s a tax rule to be aware of.
When married couples sell a home, they can typically exclude up to $500,000 in capital gains. That exclusion drops to $250,000 once you’re single. You only have two years from your spouse’s passing to take advantage of the full exemption.
That’s a short window — and acting strategically during that time could potentially save you thousands in taxes.
Divorced? Don’t Overlook These Benefits
We’re seeing more “gray divorces” than ever before. Nearly 50% of people over 60 are splitting up in retirement. Many divorced women don’t realize they may still be able to claim Social Security benefits based on their ex-spouse’s record.
If you were married for at least 10 years, are over age 60, and haven’t remarried, there may be meaningful benefits available without affecting your ex-spouse’s income. Knowing how and when to file could result in significant value.
Start by Showing Up
Even if you’re not the “money person” in your household, your financial future is still your responsibility.
So don’t skip the adviser meetings. Don’t tune out when investments come up. Ask questions. Take notes. Get curious.
If you’re not working with a fiduciary adviser who puts your interests first, it might be time to revisit that relationship.
Let’s Build Confidence, Together
At REAP Financial, we’ve helped hundreds of women step into their financial power — whether they’re married, widowed, or divorced. We understand the learning curve can feel steep, but we’re here to walk alongside you at every stage.
Want to take the next step? Schedule a consultation with our team in Austin, TX to talk about retirement income strategies, tax planning, or building your long-term financial security.
Click here to watch the next video, where I share the hidden costs of retirement you might not be planning for.
Disclosure
This content is sponsored by REAP Financial Group, LLC. Investment advisory services provided by REAP Financial Group, LLC — a Registered Investment Adviser. Opinions expressed in this article are for informational purposes only and may change without notice. This content does not constitute personalized investment, tax, or legal advice. Please consult your financial adviser and tax professional before making any financial decisions. Registration does not imply any level of skill or endorsement by securities regulators.
Chris Heerlein, a Texas native, is the CEO of REAP Financial and founder of REAP Private Client Group (RPCG), specializing in wealth creation, preservation, and growth for affluent individuals, business owners, and executives. RPCG provides financial and investment advice, advanced tax strategies, business succession planning, and excellent client service. Chris is a trusted financial advisor, author of Divorce With Dignity (2019) and Money Won’t Buy Happiness But Time to Find It (2017), and a columnist for Kiplinger Personal Finance Magazine.
He has been featured in Fortune, Money Magazine, Bloomberg Businessweek, and U.S. News & World Report. Chris also hosts Wealth Radio on NewsRadio KLBJ and is a sought-after speaker. Based in Austin, Texas, he lives with his wife, Hannah, and their three children and actively supports charitable causes.
