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Financial planning doesn't happen by chance

Latest local statistics reveal that women are playing an increasingly critical role in ensuring the financial security of their families, highlighting the need for proper financial planning for all women. In South Africa, women make up more than half of university graduates* and over 50% of families are headed by single mothers**. For many of these women, the role of breadwinner brings with it an additional responsibility – managing the family finances. Why is it then that so many women leave their financial planning to chance?

 

A woman who is juggling a busy work and home life can easily make excuses that she does not have enough time to create a financial plan. But family responsibilities should never impact on financial security. 

 

 

Every woman is fighting a different battle, and it can come in the form of ‘black tax’ (the extra money that black professionals are coughing up every month to support their extended families), ‘pink tax’ (where women pay more for gender-specific items) or even being in the middle of the ‘sandwich generation’ (being financially responsible for parents and own children). All of these situations can make it harder for women to make ends meet.  

 

At the end of the day, it all boils down to the expectations that you have set for yourself and others. Ultimately, you are accountable for your financial situation and it is your responsibility to take control of your income and expenditures in order to ensure your family’s needs are met and they are financially secure.

 

The key is to always be honest with yourself regarding your financial status. You choose the type of relationship you want to have with your money, it is very important to understand what financial security means for you and to determine what your desired financial goals are. 

 

For those women who are married or in a long-term relationship, it is important to realise that your spouse or partner is not an insurance policy. The life expectancy for women is longer than for men, so you need to plan accordingly and protect yourself. 

 

The modern woman can create wealth by being deliberate and having a plan; just as you have goals for your career, you need to also have wealth goals. 

 

The following are some non-negotiables to help you reach your financial goals: 

• Let go of the guilt and look after yourself first, then you will be able to look after others.
• Take time out to understand your finances, tax, your employee benefits, insurance, savings and investments.
• Draw up a budget and stick to it. Share it with your family, to manage their expectations of you.
• Start saving as soon as possible. Consider investing in a unit trust through a debit order. This will instill a regular saving habit and can assist to accumulate wealth over time. 
• Just be patient and let your money grow, do not spend your savings. 
• Quantify your worth, not only your salary, but also the time you spend to raise your family and build your home - and protect that with income protection insurance.
• If you have assets, protect yourself against theft or damage by taking out insurance.
• A life insurance policy must be part of your financial plan if you have dependents and it can help with intergenerational wealth creation. 
• Retail therapy is not a financially savvy move. Spoil yourself, but within reason and it must be a part of the plan. 
• You are not too rich or too poor to have a financial planner. Seek help from a financial planner. There is also a lot of free information available from reputable sources. However, always trust your gut when seeking advice, if something doesn’t feel right, it is probably in your best interest to walk away. 

 

Financial freedom is a mental, emotional and educational journey. Know your worth and reach for your goals with a purpose. “When you know better, do better,” - Maya Angelou.