6 financial tips most women should consider

Know your workplace worth, and ask

Employees with the confidence to negotiate a higher package are deemed to be more valuable to the business and all-round better performers, which positively affects their self-esteem and confidence. In the book Women Don’t Ask (Babock and Laschever, 2007), the authors found that while 57% of men negotiated their starting salaries upwards, 93% of women accepted their first offer.

Most employers would pay a candidate less than they’re worth if they aren’t prepared to negotiate salaries upwards.

Don’t rely on anyone else for security

In marriage, ensure that you and your spouse shoulder your financial responsibilities together, regardless of who generates what income. Not being in control of finances in the event of death, disability or divorce can leave a woman incredibly vulnerable and severely limit her decision-making powers.

Don’t take on your partner’s debt

Before getting married, fully understand your partner’s financial position. Ensure you don’t take their debt on personally. If you marry in community of property, you’ll be jointly responsible for all debt incurred by your spouse, even that incurred before marriage. Consider marriage out of community of property where you aren’t liable for any of their debt.

Take risks

Mercer Consultants’ research found women are less likely to choose aggressive, growth-targeted strategies, opting for cash or low-yielding savings accounts to save money. They consequently miss out on long-term growth opportunities. However, research also shows that when they do invest, women actually make better investors than men, as they’re more cautious, tend to trade less and are more likely to follow investment advice.

As women tend to live longer than men – and thus have a longer investment timeline – it makes sense to invest in growth-targeted strategies.

Start early

Women tend to start investing later in life as they generally earn less when starting their careers and maternity leave interrupts savings. This is compounded by women generally living longer and therefore needing more retirement savings.

Begin investing with your first salary – even if it’s R100 per month. Avoid withdrawing retirement benefits when changing jobs. Check your employment contract for maternity benefits to ensure you can stick to your investment plan during child-rearing years.

Think before giving up work

The decision to give up one’s career entirely to raise children shouldn’t be taken lightly: there are massive financial, emotional and relationship issues to consider. Many such women attest to feeling bored, unstimulated and resentfully reliant on their partner for money.

The working spouse can feel enormous pressure as the sole breadwinner to work longer hours to make ends meet.

Whether you choose to continue working full time, part-time, to freelance or completely give up your career, understand the financial and psychological implications for the foreseeable future and when your kids are at school.

Eric Jordaan is at Crue Invest

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