Do you enjoy managing your finances? Or do you avoid it at all costs? Although consistent financial planning is often a goal many make but never quite reach, knowing how to handle your finances is an essential part of a fulfilling, successful life. A financial plan is especially important for women, who tend to live longer than men but earn less and spend fewer years in the workforce. Studies have found that approximately 90% of women will be solely responsible for their finances at some point in their lives.
“I’ve seen too many women unaware of the assets they have and confused on how to manage them if something happened to their spouse or themselves,” said April Hampton Perez, the senior director of development for planned giving at Southwestern University. “Women need to be educated, especially since they own a large percent of businesses in this country. But whether they are running a corporation, a household or both, women need to understand the importance of financial planning and how to do it.”
Explore the following financial planning tips offered by other women in finance and implement them into your own plan to ensure financial success now and in the future.
Top Five Financial tips for women
Focus on Your Goals
The best financial plan is one centered on your goals and values. Whether you’re preparing for retirement, a child’s college fund or another important life milestone, identifying your goals and where you are in relation to them is the first step for a successful financial strategy.
“It’s important to ensure your goals and values are at the forefront of your financial planning,” said Katie Brewer ’02, CFP® and president of Your Richest Life. “Make sure you’re spending money on the things that are important to you and that you’re planning ahead to meet your goals and avoid obstacles.”
If you don’t think you have enough knowledge to properly manage your finances or feel guilty that you aren’t doing more with your money, the most important thing to do is start. As a financial planner, Brewer often sees such feelings among her clients and encourages them to be confident in their financial knowledge. “You don’t need to be in the top financial shape of your life to move forward on a financial plan,” she said. “Baby steps are what get you in shape to run the marathon.”
Review your budget
Even if you’ve had a budget for years, it’s important to regularly review it and make sure you’re staying on track. As your situation changes throughout the years, it is also essential to tweak your budget where needed. “The way in which we develop our plans and budgets must be tailored to our reality,” said Nancy Granovsky, a retired Texas A&M University family economics specialist.
Granovsky shared that retirement, a change in family composition, health status or employment, or any other significant change in income or expenses are good times to re-examine your budget. Brewer added that no matter your situation, you can improve your saving habits by automating payments into a savings or retirement account. She also advised that people should know how much their monthly fixed expenses run and have a goal for variable expenses, which can be easily tracked by designating a separate checking account for such purchases.