What All Women Should Know About Personal Finance
By Yusuf Osman, MBA
Until COVID-19 hit in the spring of 2020, the power of women in Canada’s labor force was increasing. In fact, the employment rate of working-age women hit a record high in September 2019. (1) But due to the impact of the global pandemic, about 20 years of progress went out the window. Women now face higher unemployment numbers (2) and tough career decisions as they try to juggle working from home and facilitating the education of their children who are learning at home due to school closures. (3)
As a result of these factors (and other disadvantages, such as a longer life expectancy with fewer years working than men), women need to be even more informed about their financial opportunities and how to maximize what they have. Whether single, married, divorced, or widowed, here are a few key principles all women should know about personal finance in order to prepare to succeed.
Have A Plan For Spending And Saving
To reach your financial goals, you need to track your spending. Even if you have a high net worth, you may be surprised at how much more you could save if you cut unnecessary purchases. It could potentially equate to thousands more by the time you retire.
While it’s estimated that 85% of women make the primary decisions about their family’s day-to-day finances, that number drops down to 58% when it comes to making decisions about longer-term retirement and investment planning. (4) Since having a long-term plan impacts short-term decisions and behaviors, women need to be involved in all aspects of a household’s finances.
If you’ve left budgeting or planning up to your spouse or partner until now, set aside one night a week to go over the details and get on the same page. It could save you a lot of heartache and frustration down the road should something happen to your spouse or your relationship.
Find More Ways To Save
Once your budget is solid, start looking for opportunities to save more money. There are typically two ways to do this: decrease spending or increase income. The most effective way is a combination of both.
Small everyday purchases add up to a large amount of money over time. Think about ways you can decrease spending without depriving yourself. Could you make your own coffee throughout the week instead of grabbing a cup on your way into the office? If you want to increase income, could you ask for a raise at your current job, rent out your spare bedroom, or start a side job?
Whatever you do, make sure you take advantage of your retirement plan. Whether it’s an employer-sponsored plan or a personal plan, contribute as much as you can—especially if you’re near retirement. You’ll thank yourself later.
Invest With Confidence
Investing is a great way for women to close the gender pay gap and save extra money for retirement. Did you know women typically have a 0.4% higher return on investments than men? (5) It’s true. However, overall women invest less money than men (about 40% less, according to a Wealthsimple survey). (6) Breaking this cycle and having a strong investment portfolio gets you one step closer to reaching your financial goals—and living the life you want in retirement.
Find A Trusted Partner
It’s never too late to get on track toward achieving your financial goals. Start by setting manageable financial goals for yourself (and if you’re married, set goals with your spouse) and putting a plan in place to achieve them. If you’re feeling overwhelmed, remember that you don’t have to walk this journey alone. In fact, a great way to gain momentum toward achieving your financial goals is to seek help from a trusted professional who will walk with you and ensure you stay on track.
If you need help putting a plan together, I’m here to help guide you through the process. And if you or someone you know could benefit from my Life By Design Plan, please refer them to me. Let’s start the conversation to see if I am the right fit to help you pursue your ideal financial future. Contact me at (613) 230-5895 or firstname.lastname@example.org.
Yusuf Osman is a Senior Investment Advisor at Argosy Securities Inc., an independent full-service financial advisory firm dedicated to helping clients create financial freedom, security, and peace of mind. With over 30 years of experience in the finance industry, Yusuf is committed to educating, engaging, and inspiring as many people as possible to take control of their finances. He spends his days developing a thorough understanding of his clients’ lives, concerns, and dreams to help them build a financial plan that keeps pace with changes in both the markets and their lives. Yusuf graduated from the University of Ottawa with a bachelor’s degree in Science and earned an MBA in Finance from Queen’s University. To learn more about Yusuf and his Dynamic Wealth Program for Women, go to https://www.argosy-osman.com/women or connect with him on LinkedIn.