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17 Important Financial Tips for Women


Unfair as it may be, the reality is that women are often at a disadvantage when it comes to finances. Though the gap has closed considerably in the past fifty years, women still only make about 77 cents on the dollar compared to men. Also factor in that women are often out of the workforce for an average of seven years due to maternity leave and time spent raising and caring for children. This latter activity reduces contributions to pensions and social security. But the situation isn't hopeless. There are many things women can do to help secure their financial future. Here are a few tips to help you gain control and confidence when dealing with your finances.
  1. Set a financial goal — Setting a goal for yourself can be one of the most important steps in financial success. Without financial goals and plans for meeting them there is a tendency to simply go with the flow and leave the future to chance. Knowing where you want to end up is the first step in getting there. So, sit down and figure out what your big financial goals are and how you plan to reach them. Often it helps to create smaller short-term goals to help you feel more successful along the way. Make sure to evaluate your progress over time to see if you are on track to meeting your goals, and before you know it you'll be on your way to feeling more financially secure.
  2. Don't go it alone — If you're having trouble getting a handle on your finances you don't have to go it alone. If you're deep in debt and you feel helpless, it can often be helpful to join a support group like Debtors Anonymous. Sharing your financial burdens with others and learning from their experiences can be a great help. If you're just unsure how to get started, a class on financial management can be a great place to begin. Many places offer classes that are free or at a low cost. Women are often intimidated by investments, and being unsure about options causes much of this intimidation. When you learn more about your finances, you'll feel more confident.
  3. Get professional help — Aside from classes, if you're in need of financial guidance sometimes it's best to just find a professional who can help you along. A financial planner or a CPA can help you to allocate your assets into good investments and to create a plan for retirement. Though they do charge a fee, the benefit of their experience and knowledge can be worth the money. Make sure you find someone you can trust, as sad as it is, not everyone has your best interests in mind. Get a recommendation from a friend or relative when possible.
  4. Take control of your finances — While most women participate in the day-to-day finances, there are still some women who leave these decisions to a boyfriend or spouse. Do not let someone else have complete control over your financial future. Relationships should be equal partnerships and finances should be no exception. Know where your money is located and make sure that it's being invested in a way that you see fit. It may not be a nice thought, but relationships do often end, so you should ensure that you will be equipped to handle your own separate financial future if the circumstance should arise.
  5. Buy your home — Women often wait until they are married to buy homes in conjunction with a spouse, or they expect a husband to buy a home for them. While these situations can arise due to financial limitations, you should try to purchase your own home. Over the long term, renting is a poor investment. If you plan on staying in a place for several years and can afford to make a down payment, buying a home is a much better investment.
  6. Negotiate your salary — Don't be afraid to ask for what you're worth. Be confident in your negotiations - you're much less likely to get a raise if the boss feels he or she can get away with paying you less. If you feel you're being underpaid, speak up. You may not always get what you ask for, but you'll never know if you don't take the chance.
  7. Know your risk tolerance — Women are often prone to be more conservative than men in terms of making investments. There are times when it is might be wiser to seek an investment that is riskier but that might lead to more aggressive growth. Don't be afraid to take a risk every now and then, as it might pay off. Everyone has a difference risk tolerance, however, so consider this carefully before making any potentially risky investment.
  8. Plan for retirement — Statistics report that women often save half of what men save for retirement. This would be a problem in and of itself, but women on average live longer than men, and should therefore save for those extra years as well. Experts advise that women save 12% of their income for retirement, while men only need to save about 10%. It's never too early or too late to start saving for retirement.
  9. Learn from your mistakes — Everyone makes mistakes, but financial mistakes can open opportunities for growth. Don't let these past errors keep you from future success. If you spent years getting out of credit card debt then use that lesson to keep you from racking up future debt. So long as you're not making the same mistakes over again you'll be fine; so don't let your past hobble your future.
  10. Start making smart investments — There is no better time to start investing than right now. Women often receive less in retirement benefits than men, so they need to be more aggressive about their investments and savings. Don't be afraid to make mistakes in investing - you can't know everything from the get-go. Read up on how to invest online, through books, or consult someone you trust to help you with your new investment strategies.
  11. Get out of your comfort zone — Most important financial decisions, like asking for a raise or making a risky investment, can involve a certain amount of discomfort. Of course, without this discomfort there is no chance of gain. Stretch yourself to achieve a financially successful future.
  12. Remember that it's never too late — Even if you don't start saving until late in life, don't despair. It's still possible to start late and finish wealthy. Start saving as much as you can right away and reduce your spending. You might have to work longer than you had planned previously; but, if you set a goal and work toward it the work might not seem so horrid.
  13. Do not depend on pensions or social security — Women are often at a disadvantage when it comes to pension plans and social security. Women often spend fewer years in the workforce and, therefore, earn less on average than men. This lack of work years can contribute to a lower average in social security benefits and pension payout. Make arrangements for additional retirement investments that might be available through your employer or through some other investment vehicle.
  14. Get out of debt — One of the most important steps to becoming financially secure is to eliminate your debts and to create a budget to help manage your spending. Start by paying off your highest-interest debt first, or, if you can, transfer any credit card debt to another card, preferably to cards with lower interest rates. Once you have these immediate debts out of the way you will have more money for saving and investing.
  15. Do tax planning — Whether or not you own a home or business, taxes can become an integral part of your financial plan. Make sure that you take advantage of any tax deductions that are applicable to your situation, including any investments in tax-free retirements plans. Contribute as much as possible to those retirement plans to that you recieve maximum tax benefits.
  16. Don't use money to make yourself feel good — While buying yourself a new pair of shoes or a new outfit might make you feel better in the short term, that warm fuzzy feeling usually fades quickly. If you're having a rough day, invest your time in something that doesn't cost you anything, like taking a walk or talking to a friend. Part of being secure financially is learning how to spend less, and you can't reach that goal if you spend money to make yourself happy.
  17. Have an Emergency Plan — While planning for the more distant future should be your main concern, you should also have some money saved for an unexpected event. Without this backup fund, if you were to lose your job you could end up relying heavily on credit cards. That plan of action isn't the best, as it could lead you into a downward debt spiral. If you save enough to carry you through six to nine months without employment, you'll feel less desperate when you apply for new jobs.
While these tips don't only apply to women, they do address many of the issues that women face when dealing with planning their financial future. If nothing else, remember that your financial success depends on your attitude about money and your willingness to take your financial future into your own hands. 

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