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We all know how the saying goes but unfortunately when it comes to finances, some women are definitely not leading the ‘greater’ charge. As a group it seems there are just too many other things to worry about. But with women living longer, and divorce just as likely as the probability of staying married, financial independence should be a reality, not a pipe dream, for all Australian women.

The ‘Financial Literacy - Women understanding money’ report by the Australian Government’s Financial Literacy Foundation, found that 52% of women find dealing with money stressful and overwhelming and an 23% don’t think they have the ability to plan for their long term future. While these figures are far from positive, in fairness history dictates that financial independence is relatively new and unknown territory for women. Considering as recently as the 1960s, where women working in some parts of the public sector were required to leave their jobs once they married, it’s not surprising that very few of our mothers and grandmothers have been in a position to impart individual financial pearls of wisdom.

While the Australian picture of social equality is constantly improving, the fact remains that the majority of women face unique and specific issues when it comes to their finances. Traditionally women are far more likely to take time out of the work force to have children or to act as care givers to family members. Whether this means dropping back to part time work or exiting the work force altogether, it all equals one thing – less income, less entitlements and less super. Combine that with a longer life expectancy and you have some real issues all women should be thinking about.

So what can be done?

Plan ahead and save

• In anticipation of taking extended breaks from the workforce, start saving during the periods where you are employed full time. Monitor your spending, set a budget and stick to it. No one enjoys being more frugal but knowing your spending habits can assist you greatly in making positive changes and avoiding unnecessary expenses. Be flexible and allow your budget to adapt as your needs change.
• Set up a dedicated savings account for the long term and harness the power of compounding interest. Compound interest is a powerful tool that makes money contributed today, far more valuable than anything you save later in life.

Contributions

• If you work casually or part time, you can offset some of the financial disadvantages of your situation by making voluntary contributions to your superannuation. By doing so you might also qualify for a Government co-contribution. If you do qualify, the Government will match, dollar for dollar all after-tax contributions you make to your super up to a maximum of $1000. This amount will be reduced by 3.33 cents for every dollar your total income is over $31,920 up to $61,920. Over the course of the year a $1000 contribution amounts to less than the value of some magazines and a few drinks each week. Combine this with the Government match and you could see a big difference to your final balance come retirement time. To find out if you qualify for a co-contribution please refer to the ATO website www.ato.gov.au. 
• Even if you are not working or earn an income for a period of time, you may still be able to increase your retirement savings via spouse contributions. If your partner is working he or she can make contributions into your super account on your behalf. This can be a tax-effective strategy as every contribution made, up to a total of $3000 per year, could be eligible for a tax rebate of up to $540.

Education

• For everything in life, education is the key to independence. Take some time to learn about financial matters. Take a course, read some books or speak to the experts at financial seminars. Every extra piece of information gained will improve your financial literacy and equip you with the skills to take charge of your financial future.
  Also consider the benefits of finding a financial planner that you trust. No matter where you are starting from, a financial planner will help you think about where you want to be, help you set achievable goals and start you moving towards them.
• Remember, it’s never too late to improve your financial literacy and, in turn, your financial situation. Think about your future, your goals, where you’d like to be in 5, 10 and 30 years time and take the first step towards an independent and positive financial future today.