Women and Wealth

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Men and women worry equally about relationships, work, and health. But women worry far more about their finances. We’ve all heard of the gender pay gap, but did you know there’s also a savings and pensions gap? As women are now the highest earners in 40% of households, we need to start having honest conversations about money, no matter your gender. This International Women’s Day, we’re encouraging everyone to create the space to understand their own finances.

We’ve all felt pressure to avoid financial reality, even from ourselves at one time or another. We can find ourselves facing anxiety and end up unable to take action, hoping that it will just go away by itself! Take the time to sit down and understand your current income and outgoings and your financial goals so that you know what you’re working towards.

There are few quick and simple ways you can check in with your finances and make sure you’re set up for your future. First of all, though, you’ll need to be honest with yourself. Once you have a plan you’ll feel more confident. Here’s 4 things to think about as you figure out how to set yourself up for success.

1) Debt. Women on average have £6,786 of unsecured debt compared to £8,358 for men. However, if we really want women to achieve financial equality, there are a few small changes women can make to create a more secure financial future.

It can be daunting to think about but small steps will help you pay this down and be debt free. If you've got debt looming over your head, how can you reduce that? Can you create a plan to pay it down, or look into a debt consolidation loan to reduce monthly repayments?

2) Savings. Having an emergency fund helps reduce stress and worries about the ‘what ifs’ in our future. It means we can cope with financial shocks without needing to turn to high-cost debt or borrow from our loved ones. The easiest way to keep a saving habit is to make it automatic. If you can, save directly from your salary to keep it simple, or set up a standing order direct to your emergency fund. It’s best to send the full amount you want to put aside on pay day, rather than just relying on saving what is left at the end of your pay cycle. It’s important to take steps to get into the habit of saving, and to know that it’s ok if you need to use your savings from time to time - that’s what they’re for!

3) Pensions - we all need to save money for retirement, but this is even more important for women as women are likely to live longer! Use our Pensions Calculator to work out how much you need to save, but as a general rule of thumb you want to try and save around 15% of your salary.

Auto-enrolment at company pensions means you’ll be contributing 8% automatically (including a minimum of 3% from your employer). Take full advantage of any additional matching schemes you might have at work.

If you’re taking time off work to raise children, you can still save money for your retirement, either through an employer pension or other options like a Lifetime ISA, which gives you a 25% bonus from the government. This will reduce the financial impact of a career break on your retirement goals and help with financial peace of mind.

4) Benefits - There could be something you’re entitled to without realising, and there are a whole range of benefits and services designed to support women, especially mothers.

Look into information about what government, your employer or non-governmental organisations might be providing - everything from Working Tax Credits, Universal Credit, maternity grants, childcare schemes, flexible working, free affordable salary-deducted loans or debt consolidation, or free government money through the Help to Save scheme. It’s worth having a search online to see if there’s anything you’re entitled to that could boost your income just a little more, and reduce financial stress.

Once you’ve taken the time to think about your own situation, why not help those around you break the taboo. Talk about money! As a country, we’re pretty terrible about talking about awkward things like money, but when you think about it, it influences all the other choices we make. Talking about money is a great way for you to learn about the tips and tools your friends and loved ones might be using to help keep themselves on track financially, or to have a sounding board for your own financial questions.

Important: This is an option, not a recommendation. Your employer does not benefit from offering this service and all your communications will be with Salary Finance Limited trading as Neyber. Finwell hub content is for guidance and educational purposes only and is generic in nature. Salary Finance Limited trading as Neyber does not offer regulated financial advice. Please seek independent financial advice.