One size does not fit all

women independent financial securityIn our country, financial planning is seen as gender neutral. The reality is that men and women are often not on an equal playing field and this approach can have serious consequences.

Generally, women live longer than men. This means the effects of inflation have a bigger impact on their retirement income, which is particularly concerning because women do not always earn the same as their male counterparts, which effects the amount of savings they are able to accumulate.

Women are also more averse to risk and generally choose conservative investments which struggle to keep up with inflation.

Women who take time off work to have children often do so at a disadvantage to their
careers. When they return to the work force, they could be pressured into working harder to get the promotion or increase they need. Also, their family responsibilities are usually more demanding than that of their husband.

Many financial planners assume that marriages will last forever. However, statistics show this is not always the case. When couples divorce, the woman is most often left in a much weaker financial position than she was before. Child maintenance payments don’t always provide the same level of income they had access to while married.

I would like to see all women adopt the following strategy:

  • You should insure yourself. Protect your ability to work and earn an income. When looking at insurance, you should also consider income replacement products, and dread disease cover should be compulsory.
  • Starting an emergency savings investment will also provide you with a level of protection and financial security.
  • Start saving for retirement as soon as you begin working. Every financial decision you make should assume that you need to be financially independent.
  • Lastly, appoint a financial planner to help you manage your finances and plan for your future.
  • Take these steps today, to ensure your financial freedom.

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