Why women need a tailored financial plan

27 November 2012

Five reasons why women need a unique financial plan…

1. You are unique

Everyone needs a unique financial plan as everyone’s financial situation is unique. In order to own your financial freedom you need a financial plan that not only takes into account your personal financial circumstances but that is also flexible enough to meet your changing needs.

Women have many different roles in society and face many challenges, not least of all as a result of their role as caregivers. At the same time women today live in a society where they are faced with unprecedented opportunities. These opportunities require women to make decisions and choices which also require trade-offs, especially for mothers.

As Oprah says, “luck is a matter of preparation meeting opportunity.” In order to make the right decisions and to grasp those opportunities you need to have a clear idea about your financial situation and your lifestyle and how you can find a balance between being financially independent while being the woman or mother you want to be.

2. Living longer on less

Statistics tell us that women have a tendency to live longer than men. This means that we need to have more capital to provide us with an inflation beating income for longer.

However, there are a number of factors that result in women actually saving less towards their retirement than men. These include earning lower salaries and taking time off to raise a family.

These are unique challenges faced by women so you need to make sure your financial plan is robust enough to withstand these additional pressures.

3. Protect your value

Women make up only 31 percent of Liberty’s policyholders with income disability benefits. In 2012, Liberty received 35 percent of their critical illness claims from women. Of the 403 cancer claims, 81 of them were for breast cancer.

Critical illness cover is vital for any woman, whether you are a career woman or stay-at-home mom. Often stay-at-home moms don’t realise the impact that being diagnosed with a critical illness could have on the family, especially from a financial perspective.

Who would step into your shoes if you were not able to do the school run, the homework and manage the day to day activities and home?

Recruiting someone to assist can relieve the burden, but it comes at a price. These costs are in addition to the increased medical bills. Knowing that you have cover that will ease the financial implications of a critical illness could go a long way to peace of mind in such circumstances.

4. Diamonds may last forever, but not men

Is finding a husband your financial plan?

Many women rely on their husbands/partners for financial security. This can be very dangerous as life can change in an instant and you may suddenly be faced with financial responsibility.

Grieving for your husband while trying to arrange with your bank not to foreclose on your home loan which hasn’t been paid, or realising that your joint bank account has been frozen, is something no one wants to face.

It is important you have a good understanding of your family finances and have your own bank account.

5. Money can’t buy love

According to Google, compared to singles, married people accumulate about four times more savings and assets yet divorced people have 77 percent less assets than singles. Scary statistics which tell us that divorce can clearly take its toll on your finances.

Despite what many men may claim, statistics show that women are financially worse off than men in a divorce. One of the key factors is that women usually continue to raise their children which may impact on their earning ability, while the ex-husband’s earning potential continues unabated. So having your own financial plan and savings pot is a non-negotiable.

Make sure that you take control of your financial future. Create a financial plan that ensures that your money has meaning and allows you to truly own your life as a woman.

Article published courtesy of Liberty Life.

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