Savvy Financial Tips for Women
For many women juggling to maintain balance over career and family time, it can get tough. It is even tougher when it comes to money.
Here are some tips to help you stay in control and be financially savvy.
1. Make ‘compounding’ your bestie
Start saving ASAP and get ‘compounding’ to kick-in immediately. The key to building wealth is to start saving no matter how small or large the amount is then let your money work hard for you.
Compounding is a simple yet a powerful wealth building strategy. It’s how your savings can grow faster the longer you leave them alone. Whatever your savings maybe, it earns interest, not just on what you put in but also on the money it accumulates.
Take for example a saver who starts saving at the age of 25. For 10 years this saver saves $5,000 a year until the age of 35, and lets the money compound at a rate of 6 percent. When the saver reaches age 65, the amount is worth a nice $380,000.
Compare to this to another saver who starts saving from age 55 the same amount of $5,000 a year for 10 years at a compounding rate of 6 percent. At the age of 65, this saver has reached $66,000.
2. Practice ‘intentional’ wealth building
It’s fantastic to say you’ll start saving but it’s so much better when you actually do what you say you’ll do!
Practice ‘intentional’ wealth building actions, and automate your savings straight away. Get some dollars deducted from your pay automatically into a purposefully set up savings account.
Dedicate a fixed amount every month and invest it like it’s part of your lifestyle. Invest with intent and systemise it.
Learn to be decisive and take swift actions. Whatever your bite-sized goals maybe, get on to them immediately.
Every time you make progress, you’ll feel happier and proud of yourself. This confidence and positivity will drive you to tackle bigger challenges and life goals.
Get a financial planner and get him or her to coach and mentor you along. Being held accountable and responsible for your actions is a huge motivating factor to build a secure financial future.
3. Act like a Chief Financial Officer
Be in control over your personal finances. Get organised and pay your bills on time. Get to know your net worth position. Check in and review your bank account statements and oversee your money situation.
Like scheduling an important meeting in your diary, keep a calendar of all things financial. For example, schedule in bill reminders so they get paid on time to avoid late payment fees, major expenses like mortgage repayment due dates and the most important thing when income gets paid.
It’s like creating a month to month snapshot of all expenses and monies coming in and going out. This helps to create a budget and to plan ahead for other big ticket items coming up.
4. Start money conversations
Money issues can cause a lot of stress as well as relationship breakdowns and arguments. Before things turn nasty take the time to talk to your partner about money and lead ‘financial’ conversations.
It may seem a bit awkward in the beginning but the more you can talk to one another about money the less frustrated you will feel and more understanding about each other’s money habits.
Review your finances as a team and get on the same page. Openly talk about your financial goals, dreams, your income, your expenses, bills, your frustrations, your concerns and be prepared to make adjustments if required.
Being able to talk to your partner in a non-emotional way about personal finances soothes tensions and leads to emotional happiness and wellbeing.
5. Set bite-sized Money Goals
Set money goals to pursue with passion.
Make a list of the surprises and the shocks to see what your bite-sized money priorities should be.
Start with the biggest shock. This could be the ‘forgotten’ monthly direct debits that mercilessly zaps your bank account or racks up your credit card every month. These monthly debits of $20 or $50 may seem trivial as single items but when you consider the combined yearly sum, how rude and shocking it becomes.
Out of a shock comes a nice surprise. The more you can afford to slash and burn unnecessary monthly expenses, the more financial clout you get to either invest more and pay off your debts faster. This can only improve your money-growing power and confidence to reach bigger goals.
Make sure your bite-sized goals are potent. Be specific and set deadlines to every goal you set. Don’t be overly ambitious but be realistic. Set yourself up to win, not to fail.
So, use your emotional intelligence to get smart about your finances and take control of your financial future with these tips.
For help on reaching your financial goals, talk to a Dome Financial Planner in Charlestown, Tamworth and Hunter Valley.
The information contained on this page is for discussion purposes only and is not intended to constitute financial product advice. It does not take into consideration any persons objectives, financial situation or needs. You should consider its appropriateness in light of your circumstances and consider seeking professional advice relevant to your individual before making a decision based on any information on this page.