Photo Credit: Nicki Mannix
For most women, financial strategy isn’t about accumulating wealth in itself.
We plan and save in order to ensure financial security, with the end goal of creating the brightest future possible for our loved ones.
This means that looking ahead is not only essential for our bank account, but more broadly the well-being of ourselves and our family.
Here are four common life changing events to think about when planning your financial future.
Career pivot points
Career pivot points come in different shapes and sizes: A promotion is an income change for the better. How you do or don’t spend your money gives you the potential to enhance your financial stability. Starting your own business grants you flexibility and increased earning potential. Just plan to ensure that this doesn’t cost your financial security. Losing your job or having your hours reduced can cause a major financial crisis. Unfortunately, this event rarely comes with much warning and often requires some quick thinking to get by in the short term. How do you see your career future? Are you thinking of starting your own business? What are the potential bumps in the road, and how can you cover yourself should things fail to follow script? Thinking about your career trajectory will allow you to forge a reliable financial strategy.
Marriage
In marriage, we become connected to our spouse in more ways than one. Most couples merge financially and take on each other’s savings, debt and spending habits along the way. Adjusting to joint money management with your partner takes negotiation, communication and patience – especially when one of you is more liberal with your spending than the other. You will need to decide what to prioritise and how to budget for the big and little things alike. As much as you trust your partner, it is vital to maintain access to your accounts and be aware of where your money lies. Always know what you are signing and how financial decisions will impact you. While it may feel inconceivable at this moment, a solid financial plan may prove the difference between bankruptcy and financial security should your marriage end in divorce.
Caregiving
Women often take on the caregiver roles for children, ailing parents and ill loved ones. The intricacies entailed in caregiving can cause your every day costs to skyrocket and your weekly income to plummet due to a reduced capacity to work. Whether you are welcoming a new child into the world or opening your doors to a loved one in need, financial strategy is crucial. You need to determine whether or not to continue part time work, how to distribute caring responsibilities and if you should invest in childcare or a professional carer. In the long term, you will also need to consider whether this level of income is sustainable for any foreseeable future needs. If private school or costly medical equipment are on your radar, you may need to implement a savings strategy now to ensure your security in the future.
Retirement
After decades of hard work, retirement is a welcome moment of life change for most. However, retirement can also come with difficult financial aspects that need to be considered. Even affording to retire means implementing a solid financial strategy and thinking about your financial future well in advance. Retirement itself can also be a learning curve: when a consistent income is no longer on offer, it can be difficult to attain peace of mind. To combat this, you may want to consider maintaining part time work after you leave your career, or investing a portion of money to strategically grow your savings.
