Why is financial independence important for women? And what can a woman in her 30s do to get there?
It’s fair to say this is something I’ve been thinking about a lot, having just joined the big 3-0 club in September. So when Catherine K. Burke from Online Payday Loan Consolidation reached out and asked if she could share some of her thoughts on the topic, I was all for it.
Are you a woman in your 30s, wondering what you can do to plan for a better financial future? This post is for you.
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Why financial independence is important for women
Taking steps to become financially independent isn’t just a good idea — it’s a necessary one.
Every person should work toward achieving financial independence regardless of gender. However, today our topic of discussion is what steps a woman in her 30s should take to achieve this goal.
Studies reveal that today, women are supposed to control about 32 per cent — or $72 million — of wealth globally. This figure was about $51 trillion five years ago. Additionally, experts are of the view that about 90 per cent of women, in today’s world, will have to manage their finances single-handedly.
Women need to gear up to narrow the gap of gender financial inequality.
What does “financial independence” mean?
To me, financial independence means earning one’s living, not depending on someone financially.
A financially independent woman knows how to make good and right decisions about the money. They play an important role in planning family finances for a better financial future.
So what steps can a woman take to become financially independent?
It is better if a woman starts planning for becoming financially independent by at least her 30s. She has to keep in mind that she might need to take a break from job life to bring up children.
The earlier you start, the better off you will be financially.
Seven things women can do in their 30s to help achieve financial independence
Wondering what steps a woman in her 30s can take to get on the path to achieving financial independence? Here are seven simple things that can make a big difference.
Change your perspective about money
You need to see money as a measure to do whatever you like to do in life. It gives you the freedom to live life on your terms. And to achieve that, you need to be financially independent first.
Even if you don’t want to retire early, becoming financially independent allows you to choose what you want to do instead of working just for money.
Make becoming financially literate a priority
Financial literacy is important. That’s why schools have started providing financial education to the students so young people start managing money at an early age.
Becoming financially literate is a key element of learning how to manage your personal finances. For some, this could involve learning from a parent or guardian, reading books and blogs or turning to online courses.
Know your net worth and calculate how much you need
To manage money in your 30s, first of all, have a clear idea about your net worth.
Take into account your savings, fixed deposits, investments, along with the worth of your other tangible and intangible assets.
It is better if you calculate how much you need to lead your present lifestyle after retirement. If you want to retire early, your calculation and strategies need to be planned accordingly.
Grow your savings and protect it
To become financially independent, you will have to master the art of planning a realistic budget. You can’t save a decent amount without a budget that you can follow with ease.
Start investing in a retirement fund if you haven’t done it yet. A financial adviser can help you to select such a retirement fund based on your financial scenario.
After you can save a decent amount, start protecting your savings. One thing you can do is make sure you have insurance coverage that is sufficient for your needs.
You also need to invest for a better financial future. Take help from an experienced person to build your investment portfolio. It shouldn’t be comprise of only one investment. You need to invest based on how much risk is appropriate for you.
Stay away from debts that do more harm than good
Debt won’t do any good to you.
It’s OK to take out a mortgage loan or a student loan since they help you build an asset and to acquire higher education accordingly. But you need to manage them properly.
Stay away from credit card debts and payday loans. I’m not saying to stop using credit cards, but pay off the entire balance at every billing cycle. And, an absolute no-no to payday loans.
If you’re facing a problem with managing your unsecured debts, take professional help and solve the problem ASAP.
Set short and long term goals and become a good planner
Set realistic goals and have a plan to achieve them within the deadline. Write down goals and stick them in a place where you can see them daily. It will help you achieve them.
Evaluate your success from time to time. You can break your long-term goals to short-term ones; doing so, you can evaluate whether or not you’re able to achieve them on time.
A good planner always succeeds in life. Be a good financial planner.
Plan for unexpected events
No matter how much you plan, you don’t know when an unexpected event may occur. It can be a job loss, a medical emergency, or a sudden car repair.
This is a must. You need to be prepared.
Create an emergency fund and save about five to six months of living expenses. Make sure you don’t use the money for any other purposes unless it’s a real emergency. And, once you use it, replenish the fund as soon as possible.
Don’t worry about mistakes while trying to plan for a better financial future — life happens. Take calculated risks and learn from your previous mistakes, as they’re the stepping stones of success.
Catherine K. Burke loves to write about the financial problems of life. She faced a financial hardship in her earlier days with her payday loan debts. It made her life full of stress. Today, she motivates people to face the difficult situation positively to get a better outcome.