What is your vision of the ideal woman? A careful mother and loving wife whose duties are limited to housekeeping, cooking, parenting and self-care, while the role of the main (and only) breadwinner belongs to her husband?
No way! Today’s ideal woman is the one who knows how to stand up for herself and remain self-sufficient, both emotionally and financially. Even though it’s not that easy, this may still be achieved through a set of skills that may be learned. The main thing after all is to lay down an aim, work hard and trust in oneself.
So what are the smartest actions every woman should take to ensure her financial security?
Always be aware of your financial situation
In fact, that’s one of golden rules of personal finance management. It is an awful idea to hand this concern over to your husband, whatever trusting relationship you two may have. Statistics say that about 40 to 50 percent of all marriages in the United States end in divorce and after all, women live longer than men. In view of this, you should always be organized and know where all your savings and investments are located, and even more importantly, you should be aware of the costs your lifestyle requires.
The problem of many women is that personal finances simply do not belong to the sphere of their interests. They may have an interest in beauty and health care, parenting, films and books and so on, but finance management is rarely the case. For this reason, lots of married women turn their financial lives over to their husbands, while the majority of single, divorced and widowed women prefer to commit this task to the trust of financial planners and advisors. To passively agree to everything you are advised might work in some cases, although sometimes it leads to terrible consequences.
Saving vs. investing
These are two methods to achieve financial independence in the long run, although they are often not that easy to combine. Saving money is the process of putting money aside, little by little. You can open a saving account, money market account or a CD, for instance. They are federally insured and therefore very safe, but the problem is that savings do not have the potential to bring any substantial profits, while investments do. Investing, in turn, is the process of using your money to buy an asset that is expected to increase in value. You can invest in stocks, property, shares or try high frequency trading, especially if you have not much experience in this field (find out more on Glenmore Investments website). This is much riskier than saving, but the potential returns may be huge.
The choice should depend on your goals and current financial situation, although the best option would be to organize your capital in a way that would allow you to save and invest simultaneously.
Start saving for retirement
Investing is important, but a solid retirement plan is a must-have. You shouldn’t rely on Social Security – in the 2030s it will be paying only 75 percent of scheduled benefits. Employer-sponsored 401(k) is a great choice for many, but if you still want to have more control over your retirement account, traditional IRA or Roth IRA would be better options. The difference between the two lies in tax rules. Contributions to traditional IRAs are made with pretax dollars, but you will need to pay taxes on retirement withdrawals. Roth IRAs, in turn, are funded with after-tax dollars, but give you a tax break after retirement.
You will need to carefully investigate all the details before you take final decision, but remember, anyway, that the hardest thing is just to start.
Live within your means
There are lots of tips and tricks that may help you do this, but the secret to success is to realize that a simpler life with less stuff will not just help you cope with most of your financial troubles, but will also make you happier. Refuse from impulse buys, even if you think that you do deserve this new pair of shoes. Find the willpower to refuse from lifestyle you can’t afford and maintain. Finally, learn to say “No” when others ask you for money (especially when it comes to your kids’ whims) – you can’t buy love and acceptance of other people, whatever hard you try.