Do you back yourself when it comes to money-related decisions? If not, you’re not alone.
As women, we statistically underestimate our abilities in work, in our finances and in life at large. We’re shown to only apply for jobs when we tick every box of the selection criteria. Plus, studies from KPMG have found that a whopping 75% of female executives have reported experiencing imposter syndrome at some point in their careers.
Recent research tells us that women are making up to 80% of household buying decisions, yet consistently underrate their financial smarts. In fact, men are twice as likely to rate their financial literacy.
The result? Women are half as likely to make money moves when it comes to saving and investing.
But, we’re not going to stand for that on our watch. We want to help our entire community feel educated and empowered about their financial future, backed by the tools and insights you need to make it happen. Keep reading to discover five practical steps you can take to boost your financial fitness this new financial year.
Lean into the discomfort
Here’s the thing: none of us is an expert at anything from day one. The key to learning a new skill is to put in the time and energy. While it might be confronting and uncomfortable at first, getting a wrangle of our finances only gets easier with time.
You don’t need to know it all or understand all the confusing acronyms to make money moves. Instead, it’s about making small and incremental steps to learn more and deepen our financial knowledge.
Inaction is the worst thing we can do for our future selves. But the good news is that you’ve already taken the first step to building your financial literacy. Now, let’s keep this momentum going with a stack of practical actions you can take to boost your money confidence in FY 2023 (and beyond).
Review your super balance
You’ve heard all the stats before, but it’s worth repeating them again. The data tells us that half of Australian women aged 45 to 59 have less than $8,000 in their super fund.
More concerningly, women over 55 are the fastest-growing population experiencing homeless in Australia (and a lack of super savings is one of the driving factors here).
The sooner we review where our super is at, the sooner we can take steps to change our financial outlook. A practical place to start is to check if you have any lost super using the ATO’s free online tool. This can help you claim these funds and move them into your current fund.
It’s also worth checking if you have multiple super funds open, and look into consolidating into one account to potentially save on fees.
Want to check how much super you’ll need to secure a comfortable retirement? Check out MoneySmart’s free online retirement planner.
Master your cashflow
Ever find yourself wondering ‘where did my paycheck go?’ at the end of the month? When we’re not tracking how much is coming in and going out, we can find it touch to save consistently or reach our money goals.
Our tip? Take some time to get a handle on your cash flow by taking these steps:
- Review how much you’re earning on a regular basis and much you’re spending on expenses (and make sure your money is going towards things you really care about).
- Create separate bank accounts for your different savings goals and expenses (that could look like one transaction account, one long-term savings account and one short-term savings account).
- Automate your savings each month using direct debits to ensure you stash away your savings at the beginning of your pay cycle.
Consider ways to grow your money
Putting our money into a savings account is a fantastic first step to building financial security. But if we’re looking to grow our wealth over the long-term, it could be worth considering investing.
Before you get started, here are a few things to consider when investing:
- What are your investing goals? Whether you want to earn passive income or even secure an early retirement, start by clarifying why you want to invest in the first place.
- How long do you want to invest? Many investing strategies are long-term commitments, so make sure to think about how many years you have to invest.
- How much money do you want to invest? Some investment options require hundreds or thousands of dollars in upfront payments, while some apps allow you to start investing with small amounts of money (sometimes as little as $5).
The key to finding the right option for you is to chat with a financial adviser or do your own research to make an informed decision about the risks, fees, and timeframes you’ll need to consider before investing.
Chat to an expert
One of the best ways to really understand your options and what money moves are right for you is to work with a licensed financial adviser. They’ll be able to thoroughly review your finances, understand your goals and provide tailored recommendations about what will work best for you.
Plus, the best financial advisers will help you build your financial literacy and ensure you’re learning more about your money along the way.
Find out more about how to choose the right financial adviser for you in this handy guide from MoneySmart.
When it comes to building financial literacy, the best way to boost your confidence is to lean into the discomfort and put in the work. By wrangling your own finances, doing your own research and working with experts, you can put yourself in the best position to boost your financial fitness in FY 2023 (and beyond!).