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Help mom get her finances on track

By Jason Alderman

Mother's Day provides the perfect opportunity to celebrate your love and appreciation for the moms in your life. So buys flowers and make dinner reservations, or whatever your custom is. But before too many days pass, schedule a "reality check" conversation about personal finances to make sure your mother is covering all her financial bases.

On average, women live about seven years longer than men and earn only about two-thirds as much. Plus, women often spend far fewer years in the workforce because of time taken off to raise children. So it's not surprising that many women have less income at retirement and need to make it last longer.

Here are a few topics you may want to cover:

Retirement savings come first. Although you can borrow money to pay for your children's college, a house or a car, you can't get a loan to pay for retirement. Make sure your mom has an IRA or 401(k) plan and is socking away as much as possible. The IRS even allows catch-up contributions for people over age 50. Check out the retirement planning tips at Visa Inc.'s Practical Money Skills for Life program (

Pension annuities. By law, the default pension payout option for married couples is a qualified joint and survivor annuity, where the surviving spouse continues drawing pension benefits after the pension holder's death. Some couples (with written permission only) instead choose a single life annuity because it pays a higher monthly benefit. However, once the pension holder dies, the spouse no longer receives benefits.

If your mother will depend on your father's pension, make sure they fully understand the implications before opting for a single life annuity. Also note that she may qualify for a pension benefit after divorce. If this wasn't spelled out in the divorce settlement, consult an attorney.

Social Security benefits. Because of lower average earnings and longer life expectancy, more women than men depend on Social Security for the lion's share of their retirement income. Even if your mother didn't pay into Social Security through work, she's eligible for benefits provided her spouse did. If your mom qualifies under her own work record as well as your dad's, she'll generally receive the higher benefit amount.

Widows can tap Social Security as early as age 60 (50, if disabled). And spousal benefits are available if she's divorced, provided the marriage lasted at least 10 years, she remains unmarried and she's at least 62.

Social Security created a special website for women,, that provides information on retirement, disability and other issues – in English and Spanish. You can also order or download the helpful "What Every Woman Should Know" (SSA Publication No. 05-10127, at, or call 1-800-772-1213 to ask questions.

Another good resource is the Women's Saving Initiative, a program jointly developed by Heinz Family Philanthropies, the Women's Institute for a Secure Retirement (WISER) and Visa Inc. ( This free program features a book called "What Women Need to Know About Retirement," which you can order on CD or download as a PDF or audio file.

Discussing finances isn't as much fun as brunch, but your mom will appreciate your concern.

This article is intended to provide general information and should not be considered tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how tax laws apply to your situation and about your individual financial situation.

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