21 December 2023
By Colette Machado
Finance Manager
Financial planning for women
Taking control of one’s financial future is highly important for both men and women who want to achieve their financial goals and dreams. However, last year I learnt just how important it is for women in particular to take charge of their financial destiny.
One evening I decided to browse Eventbrite to see if there were any events of interest. I came across a free webinar titled ‘Take Control of Your Financial Future’. The title immediately caught my eye and after reading a bit further, I registered for it and put the date in my diary.
To say the webinar was eye-opening is an understatement. The content and presentation were interesting and informative as well as thought-provoking. It delivered many facts related to women generally and to their finances.
Life Events that Affect Women
I learnt that in addition to the gender pay gap, there are a number of life events that result in women ending up with less money when they are ready for retirement. These include:
Taking a break in their career to have a baby
Moving to part-time work to raise a family
Stopping work due to menopause or women’s problems
Taking time off to look after elderly parents
Women’s pension pots are affected even further as women tend to miss out on promotion opportunities for career progression when they spend time out of the workplace.
“You must gain control over your money or the lack of it
will forever control you.” – Dave Ramsay
Divorce is another life event that affects women and their pension pots. After property, the pension pot is typically the second-largest asset in a marriage and, yet again, women tend to fare worse financially than men following a divorce.
Women and Retirement
Women are reaching retirement age with £136,800 less in their pension than the average man according to a report by Now Pensions [1]. They are retiring with just 12% of the pension wealth of men.
The pension provider said women would need to work an additional 18 years in full-time employment to close the gender pension gap – which would mean working until the age of 83, rather than 65.
For self-employed women, their retirement savings pot is equally affected when life events such as those mentioned above happen. No work for a self-employed individual equals no pay, which undoubtedly highlights the advantages of being a business owner and having a system whereby money comes in regardless.
Planning for the Unforeseen
However much we plan, we know that sometimes things are simply out of our control. Covid-19 and the pandemic reminded everyone how unpredictable life can be. It came with no warning, and it showed that the need to plan as far ahead as possible is imperative to reduce any damaging effects.
Today, there is not a day that goes by when we don’t hear news about the cost-of-living crisis we are in, and how rising interest rates and increases in our gas and electricity bills, grocery shopping and mortgages are inescapable.
“Financial planning and discipline is key to one’s financial freedom.” –
Kishorkumar Balpalli
Taking control and future-proofing your finances is a proactive approach that all can and should adopt at any time – and the sooner the better. Not only can planning help you achieve your financial goals, but it can also provide peace of mind and allow you to look after your loved ones in the future.
For women, financial planning is not just important – it is crucial. Having a longer life span, gender pay inequality and taking career breaks to raise a family, unfortunately, make women more financially vulnerable.
Women Need Financial Confidence
With recent figures revealing that 85% of women control their families’ day-to-day finances and by 2025, more than 60% of the UK’s wealth is expected to be in the hands of women, it is more important than ever for women to take control of their financial futures. [2]
This also includes increasing one’s financial knowledge in order to be more confident to make those all-important financial decisions. An FCA Financial Lives survey [3] suggests that having low confidence in managing money, low knowledge about financial matters, or not seeing themselves as a savvy consumer is stopping women from taking an active role in managing their money.
FGP – At Genistar in addition to helping you learn how money works through financial education, we can provide you with a complimentary Financial Game Plan (FGP) to help you plan for your goals and achieve financial independence.
Business Opportunity – Additionally, if you are seeking extra income whilst you work part-time or full-time, or if you are seeking a career change, why not find out more about Genistar’s business opportunity
Women in Genistar – At Genistar we have a large percentage of women representatives. They even have their own support group – Women supporting women. See more about Women in Genistar here.
References:
Now Pensions, June 2022
Unbiased, August 2022
Financial Lives Survey, 2020
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