Managing finances can be more complicated for women than men. Women have added challenges when it comes to their careers, investing and saving for retirement due to familial and societal expectations. Following these five tips will help women better manage their money and their overall financial lives.
1. Handle Your Own Money
Once in a serious relationship, it can be tempting to allow the man in your life to handle all of your money matters. However, not managing your money can make you ill equipped to do so later in life, especially if you become single again. If you manage your money at all stages of your life, you will never have to worry about your finances being too difficult for you to handle.
2. Invest Early and Often
It’s never too early to start saving for retirement. Co-author of “On My Own Two Feet,” Marsha Thakor, encourages women to save 10 percent of their income for retirement. With everyone living longer, and women living longer than men, it’s incredibly important to begin building a nest egg as early as possible.
3. Up Your Earning Potential
On average, women earn less than men over their careers, but it is not all because of a gender-based wage gap. Due to children, family obligations or fear, women aren’t always taking on opportunities that will put more money in their pockets. Learn to say yes when presented with a new opportunity. It may be out of your comfort zone, but it can potentially turn into a great experience, both professionally and financially.
4. Have Multiple Streams of Income
Since women often take time out of the workforce to care for children or ailing parents, their social security and retirement benefits are, on average, less than their male counterparts. To combat the shortfall, the Women’s Institute for a Secure Retirement encourages women to have three sources of retirement income: personal savings, a work-sponsored retirement account and social security. The more money you can save during your working years, the more secure your retirement will be.
5. Pay Off Debt
Debt can be a gigantic albatross tied around your neck that never seems to go away. Make it a priority to pay off all your debt, even student loans, as quickly as possible. If you are heavily in debt, it can prevent you from buying a home, starting a family or getting married. Don’t buy into the idea of good debt and bad debt. Work to be debt free so you can have and enjoy the life you want.