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Welcome to the 2nd 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.

9 Simple Money Habits That Can Help Women Build Wealth

We know that to live a healthy life we need to be eating our five a day, drinking lots of water, exercising and getting enough sleep. And we also know that to live a wealthy life, we need to live within our means, work hard, make our money work hard for us and take it easy on the credit cards. These rules apply whether we’re entrepreneurial, business owning millionaires, managing the family budget, just starting out fresh from university or managing all three.

But there are other, simple things we can do; good habits that we might overlook, that can help us build wealth and take control of our financial destiny:

  1. Become a Spreadsheet Addict

Keeping control of your spending is hard if you’re not recording it. It might seem like a hassle, but honestly, nothing will highlight frivolous spending more than having it all in black and white. It’s a bit like keeping a food diary; annoying, but facing the truth about how many treats you’re having is a sure-fire way of cutting down.

Same with spending, recording what comes in and what goes out will highlight areas that you can make savings in. And actually, I joke about spreadsheets, they’re a bit last decade, and more than a bit clunky, especially on mobiles. Use a money tracking app such as Cleo, and it’ll change the way you manage your budget forever.

  1. Live Below Your Means

Seeing where your money might be trickling away really does make a difference, and can jolt you into taking stock and making cutbacks on things you regularly buy but don’t need (see point 3). Use a budgeting app to set a monthly budget that’s below what you can afford and forget about the rest. Out of sight, out of mind.

Set up a monthly standing order to transfer money saved into a higher interest savings or investment account. In an interview with CNBC, certified financial planner Carolyn McClanahan said, “Once you create the habit of saving, it stays with you for your entire life”. Sound advice.

  1. Save Before You Spend

Get paid, pay the bills, spend, then save what’s left. Sound familiar? How about this. Get paid, save, pay the bills, spend what’s left. One of the greatest secret to building wealth is paying yourself first.

Putting money aside for your goal, be that a pension pot, new house, growing your wealth, setting up or expanding your business, before you spend, turns the way many of us manage our money on its head.

But it makes sense, you must save before paying for expenses; otherwise, there will never be any or enough left to save.  An effortless way to pay yourself first is to automate your savings. Think of it as your first bill of the month, an investment in your future that has to be made.

This is the one piece of money advice you should never forget. Many of us live below our means but never think to pay ourselves first, so we continue to live from pay-check to pay-check.

As the saying goes, “Save a little bit of money each month, and at the end of the year you’ll be surprised at how little you still have.”

  1. Ditch the Daily Flat White

Spending a few pounds on your morning coffee fix each day might not seem much, but deep down you know that if you added it up over a week, month or year, then you’d probably be appalled. And besides, all those non-recyclable disposable coffee cups? Not eco.

Your money is well-earned, you deserve treats, so try to see daily take away coffees (and all those tempting goodies at the till that cry out for you to buy them too) as a once or twice a week, you’ve-reached-Friday treat.

Same for shop bought lunches. According to a study by the Telegraph newspaper, on average we spend more than £10 a day on shop bought lunches, coffees and snacks. That’s over £2,500 a year. Batch cooking lunches once a week and bringing them to the office will save you at least three quarters of this so you can find that spare cash to invest.

  1. Look After the Pennies…

… and the pounds will look after themselves, so they say. And micro investing is the latest way to do that. Apps such as Moneybox will round up your small spends to the nearest pound, and invest the rest without thinking about it.

For example, if you buy a coffee, say for £2.40, Moneybox will invest 60p of your money for you in one of over 6,000 global companies within a stocks and shares ISA. This is investing that you don’t even need to think about, done by experts, and will build up over time.

  1. Be Financially Savvy

The successful woman is she who is savvy about money. It doesn’t take a lot of time to be money savvy, financial success is the sum of small efforts.

Read something about money daily, even for just 2 -5 minutes; books, newspapers, blogs, and educate yourself on the ways of the money worlds.  Aim for one personal finance book each month or quarter. If you really don’t like reading or don’t have the time, try audible books so you can listen on the go.

Understanding how money, savings and investments work will mean better self-financial management (and fewer financial adviser fees). Making your money work for you, in the right account, is well within your grasp.

  1. Believe in Yourself

Remember that girl who didn’t care what was expected of her? The girl who did what she wanted and went out and got what she wanted? Even though it might have been the latest ‘in’ thing, she still believed in herself enough to get it.

She’s still in there and she can still dream big. Tell yourself that you deserve to be financially solvent and set yourself inspiring goals to aim for.

Remember, a positive mental attitude is more than just a slogan for Persil washing powder.

  1. Spend Mindfully

Absentmindedly drifting around a supermarket filling your basket, browsing online shops late at night, shopping after lunchtime wine, buying the kids too many toys. All easy to do, right? But all things that will make us spend unnecessarily.

And this includes managing all those no longer needed insurance policies, subscriptions for magazines that end up straight in the recycling and long-forgotten charity donations that come out in seemingly insignificant amounts each month.

The tried and tested rule to building wealth is to spend less than we earn. Unmindful spending eats into our budget, make sticking to our budget a challenge and can be the things that stop us from achieving our goals and dreams.

  1. Don’t Deny Yourself the Treats

When all is said and done, a life without some kind of treat can be a bit uninspired. Developing good money habits doesn’t mean that you have to give up every little luxury and spontaneous treat, just that you have to always protect the money you want to save first so you can build wealth.

Always make sure there’s enough for that Friday coffee, dinner with friends or train ticket to the beach. Or really, whatever you fancy, as long as it’s within/below your means, because, rather like our diet again, too much strictness can quickly mean a blowout.

Don’t Wait, Start Today

Although these habits are relatively simple they are just as difficult to implement. Try working on one habit at a time because nothing feels better than a celebratory treat at the end of each month firmly in the black as well as growing your wealth.

 

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