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Welcome to the 1st of a four part series on “Women – Money and Investing” by our guest expert and #connecttoher member Esther Mukoro, Founder of Money Nuggets. Genderbuzz is partnering with leaders in this field to bring essential knowledge to our audience. We have joined with Esther to empower women through financial education.

3 Reasons Women Need to Take Control of Their Financial Destiny

In today’s world, women are more financially independent than ever before. The opportunities for career growth and self-starters are booming and women are flourishing. In fact, the amount of women running their own businesses in the UK is increasing, and is expected to continue to rise.

While it’s no secret that the pay gap is still all too prevalent in many careers, the fact is that women are earning more now than ever before.

It stands to reason then that women are taking control of their financial destinies right? Wrong.

Recent surveys show that around 17% of men have a stocks and shares ISA, while only 10% of women have them and only 20% of women have an investment portfolio, compared to 34% of men. This means that there are still a lot of women out there who are failing to invest their money.

Why Don’t Women Invest?

Recent surveys show that the main reasons women don’t invest money is because either they don’t understand how to, or worryingly, because they rely on their husband’s pensions for their income after retirement.

In today’s society, there is nothing at all to stop a woman from learning how to invest her own money and gain financial independence. Women have got to take the next step and stop depending on their husbands, partners, or the government to take care of them after they retire.

Why Do Women Need to Take Control of Their Financial Destiny?

Women are hard-working and ambitious. We thrive in often male dominated environments and we can hold our own in any business scenario. We don’t allow men to dictate our actions to us nor hold us back. We step up and take control. And it is time that more women did so with their personal finances.

Here is why:

Divorce/Never Marrying

With around 33% of marriages ending in divorce, relying on your husband to control your finances is a good way to end up working long past the time you planned to retire just to make ends meet.

Of course no one wants to believe that their marriage will end up as another divorce statistic, but realistically, you have to separate your heart from your head.

Planning your financial security isn’t an indication of you believing your marriage is destined to fail. It isn’t even a safety net as such. It’s just good sense.

And if your marriage is one of the 67% that doesn’t end in divorce, then look at it as double the money, double the fun when you hit retirement age!

Some women don’t want the traditional marital set-up. They may choose to cohabitate or remain single. Not every woman wants the hearts and flowers romance thing.

For whatever reason, one in five women will not marry. Added to the divorced women, that means around 45% of women will need to be financially independent.

Women Outliving Their Husbands

Imagine this scenario. You are one of the people who have a loving, long lasting marriage. Your husband has successfully invested in a good pension and you are both comfortable and enjoying your retirement. Congratulations.

Now bear in mind that statistically, women live on average, five years longer than men. A woman may now find herself in a situation where she has no financial resources of her own to fall back on.

And with the state pension a pitiful £159.55 per week, for most people, living on that alone is not an option.

For Independence and Building Wealth

Women who have careers of their own have financial independence throughout their whole working lives.

Why would you want that to stop once you retire? Why, after spending so many years earning your own money, would you want to resort to having to rely on someone else to finance you?

Taking control of your own finances means you will never find yourself in a situation where you are reliant on someone else to finance you. And that alone is a good enough reason to take control of your finances now.

As we mentioned above, the gender pay gap is a very real issue for many women in the workplace, not least the BBC. For this reason alone, women often earn less than men, therefore, careful planning is required to build your wealth and ensure you have a comfortable retirement.

How Can Women Take Control of Their Own Financial Destiny?

At the very least, women with good salaries should be looking at investing 10% of this money into a pension fund or stocks and shares.

In general, women are less willing to take risks with investments. That means that their money isn’t working as hard for them as the equivalent amount a man invests, but it also means that they aren’t paying so much in fees when jumping from investment to investment, and as a long-term strategy, this can work in women’s favour.

Many banks and financial institutes are trying to attract more women into investing because women actually make better investors.

For the modern women, financial independence is already a high priority, and so should wealth building. Now it’s time to start investing yourself and your capital to ensure that this state of independence remains once you leave the workplace.

About

Esther Mukoro is the founder of MoneyNuggets. Money Nuggets is a Personal finance blog for women who want to take charge of your finances and secure their financial future. She is passionate about empowering women through financial literacy by providing them with smart money tips that are practical, actionable and simple to implement.

Money Nuggets is also a member of #connecttoher – check them out here.

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