Financial advice for women: Have courage, take control

As a husband, but more so, a wealth manager with a substantial female client base, I am acutely aware that women face a unique set of financial challenges compared to us men.

With the rising cost of living and stagnant salaries pushing South Africans into debt, there has never been a more pivotal time for women to develop a greater sense of financial awareness. Adding to that, a higher unemployment rate — 36,8% in the second quarter of 2021 compared to 32,4% amongst men, according to Stats SA’s Quarterly Labour Force Survey.

Whether you’re single, married, with children, divorced, widowed, or retired, here’s a guideline of financial advice for women to ensure long-term security, regardless of your situation.

Actively Upskill In Finances

Although things are changing, there is still a significant financial literacy gap between women and men. While they can be brilliant in some aspects like paying bills or saving short-term, overall many still tend to feel slightly more intimidated by others, like investing.

This recent Bank of America study shows that about 48% of women feel confident about their finances, with only 53% feeling confident to manage investments and build a diversified portfolio. Although these stats depict a US context, I doubt they’re much different here in South Africa.

The question is, how do we change this?

Ultimately, encouraging women to get proactive in gaining financial knowledge is key. The good news is that there is plenty of financial advice for women online which can help, as well as access to a whole pool of professional advisors such as myself.

There is nothing more powerful than a financially literate woman, and it’s something we should all want to encourage and see more of. Wealth-savvy women can have a positive effect on their families, society, and even the country at large. I’ll go even further by saying that it can result in a progressive society that is wealthier, healthier and more secure.

By equipping themselves with the right tools and information, women are not only better able to shield against financial shocks, but feel more inclined to dip their toes in the investment world. Even at a basic level, financial prowess can make women feel more secure and respected, irrespective of their background. It also gives them the courage to express their financial worth, especially when it comes to their career earnings.

As a side note, negotiating one’s salary has become a widely accepted practice so don’t hesitate to fight for a higher salary if you feel that you’re being undercompensated for the skills you have and the work you perform.

Maintain financial independence

Having witnessed hardworking divorcees and single mothers struggling to make ends meet (when they really shouldn’t be), I know first-hand how crucial it is for women to maintain a level of financial independence.

There is no greater feeling than feeling more in control, making your own money decisions, setting financial priorities, and developing effective habits to achieve your goals. But what I feel every woman needs to realise, is that the best time to implement the right mechanisms to protect themselves financially is right now – before that next big career shift, business launch, or serious relationship.

On the relationship front, I can’t stress this golden nugget of financial advice for women enough: try as much as possible to involve yourself in the household money decisions rather than surrendering that responsibility to your partner. Having awareness and an understanding of where, when, how much money is spent and why, is essential for those who take on the primary role of ‘homemaker’ rather than ‘breadwinner’. Staying in the know regarding bills and budgets will not only give you greater financial wisdom but prove useful should you unexpectedly be forced to become financially self-sufficient.

Of course, before even tying the knot it’s worth its weight in gold to have a thorough understanding of the different contracts: marriage out of community of property (antenuptial) and marriage in community of property, which combines everything that you and your partner owned before and during your marriage.

Whichever you both decide on, overall, establishing a financial profile in your own name to fall back on in case your marriage dissolves due to divorce or death, is something I can’t stress enough. Yes, it is uncomfortable thinking about the potential demise of your marriage, but in reality, it’s naïve not to, especially when there are children involved.

Prepare for retirement

I’d say the majority of challenges women face regarding finances culminate around retirement. But why?

Be it spending more time out of work due to family obligations, or generally having less confidence when it comes to investing, many women aren’t building as big of a nest egg as their male counterparts. Especially since, on average, women live between 6 to 8 years longer than men – a prominent statistic backed by the World Health Organization.

As it turns out, it’s expensive to be a woman – they generally need to be able to fund more retirement years, regardless of their marital status. Adding to this, surveys conducted at the Bank of America show that 90 percent of women are more likely to manage their finances during retirement on their own.

Preparing for this eventuality is key to financial wellness for all women. But what’s most important to remember when it comes to financial advice for women, is that it’s never too late to get started. Whether you’re in your 30s, 40s, 50s or 60s, developing a strategy to preserve and grow your wealth is always the first point of call.

As for planning for retirement, don’t count on simply inheriting from your partner once they pass on. Ultimately, there’s no quick fix. Plan, don’t react. The surest way to build wealth is to start saving as early as you can and to keep at it consistently over an extended period of time.

The bottom line…

So often, money is a source of shame for some women, when it really should be a source of freedom, empowerment, and security. And while it does take time to understand the ins and outs of finance, what’s most important is a willingness to learn.

Having provided plenty of financial advice for women over the years, I’ve made it my mission to encourage my female clients to ask as many questions as possible. Whether you (or a woman you know) want to gain financial confidence and peace of mind, there is a whole pool of qualified professionals who would love to help.

Ready to feel more in control of your financial future? I’m here to help strategise the best way forward with a high level of care. Get in touch here, or drop me a direct email: giles.maynard@carrick-wealth.com

I’m Giles Maynard. I provide individual investment and wealth management services for private clients and companies. I have been trusted by clients, large and small to manage, protect, and preserve their wealth. How can I help you with yours?