In honor of International Women’s Day (March 8th), it seemed appropriate to write about how women can become more financially empowered. For various reasons, including longer life expectancies, women are more likely than men to be on their own at least once during their life. Yet many women aren’t comfortable managing their personal finances and often defer to the men in their lives to do it for them. As I tell my female clients, “a man is not a financial plan”. It’s in our own self-interest and our children’s to take responsibility for our financial lives. Here are some tips:
- Get smart about money. One of the best things women can do to become more financially empowered is to learn more about personal finances and investing. One of my favorite books on this topic is Barbara Stanny’s Prince Charming Isn’t Coming. Another good read on the basics of investing is The Elements of Investing by Charles Ellis. There are also lots of resources online.
- Invest, don’t just save. Many women are good savers, but end up leaving money earmarked for long-term goals in low interest savings accounts. The result is their money is not working as hard as it could to help them achieve their goals and it is losing money to inflation every day. Women need to get comfortable investing money for long-term goals. It doesn’t need to be highly speculative bitcoin or penny stocks, but can be in low-cost, well diversified index funds. Investing is riskier than just leaving money in savings, but most of us need to accept some risk to earn higher returns to achieve our goals.
- Lean in. One of my favorite books of this name made the point that women often do a poor job of negotiating for things they need and deserve, like higher pay or more senior roles. Particularly while we are younger, our human capital is one of our most important assets. It’s critical that we do all we can to nurture our earnings power and career potential. There are many things we can do to get what we deserve, whether it’s taking a negotiating class, working with a career coach or taking classes to improve our skillset. The important part is to be proactive about taking the steps necessary to preserve and grow our human capital.
As we celebrate all the progress that women have made around the world in areas as diverse as education, health, safety and business, let us make sure we are doing everything in our power to become financially empowered women, for ourselves and our children.