Worried about your personal finances? You’re not alone. Managing personal finances as woman can be a challenging experience.
Of course, financial wellbeing isn’t gender-specific – it’s a universal goal. But it becomes much more important for women, who have to deal with financial challenges that men simply do not face.
Why is financial wellbeing so important for women?
Women face unique financial challenges that differ from men’s experiences.
The gender pay gap means women earn less than men on average, and the gender pension gap can lead to smaller retirement funds. This problem is even bigger when you consider that women tend to live longer than men – those smaller retirement funds need to stretch even further!
Then there’s the pink tax. Essentially, products that are marketed to women, like shampoo and razors, often cost more than the male equivalent. With all this to think of, it’s no wonder that women tend to worry about money more than men[1].
The good news is, improving your financial wellbeing can help counteract that stress. While it won’t singlehandedly solve global issues like the gender pay gap or the pink tax, it can empower you on a personal level and set you up for a financially secure future.
Talk to a financial advisor
Financial wellbeing isn’t just about having money. It’s about understanding your finances, knowing how to reach your goals, and practising smart money habits. When you do this, you tend to feel more confident and in control. And when you feel in control of your finances, you’re less likely to worry.
So, what can you do to whip your finances into shape?
Make the most of your pension
When you consider that the average life expectancy for women is 84[3], and the current State Pension age is 66, you could be looking at spending almost a quarter of your life in retirement.
What will you do with your potential decades of retirement? Maybe you’ll travel the world or spend more time and energy on your favourite hobbies. But to make your dream retirement happen, you need to prepare for it financially – so it’s imperative that you have a solid pension plan.
This brings us to another important but often overlooked issue: the gender pension gap.
What is the gender pension gap?
In Ireland, less than a third of women over 55 have a private pension[1]. What’s more, those women that do have a pension have, on average, €120,000 less in their retirement fund than men[2].
This gap exists because women earn less than men on average, and your pension contributions are closely linked to your salary. Many women also juggle multiple roles and take career breaks to raise children or care for family members.
These periods of lower or no income (like maternity leave) can lead to even smaller pensions, making it harder for women to build a big enough pension for a comfortable retirement.
But setting up a pension early and making the most of employer contributions can go a long way to bridging the gap and improving your financial wellbeing.
Make your money work for you
The Bank of Ireland found that only 15% of women feel confident managing investments without an advisor, compared to 27% of men[1]. This is despite the fact that multiple studies have found women outperform men when investing[4].
Contrary to popular belief, investing isn’t just for the wealthy; it’s an accessible way for anyone to have a chance of growing their savings over time and try to beat inflation. And while it’s true that investing comes with risks (the value of your investment can go down as well as up, and you could lose some or all of your money), if you invest over a longer period of time these risks can be reduced.
Many experts recommend investing for a minimum of five years – it’s a long game.
Investing with confidence
If you are one of the 85% of women who isn’t confident managing investments without advice and you’d like to learn more about investment strategies, know that the key is to make informed decisions.
This means doing your research (we’ve got an easy-to-follow guide to help you get started) and potentially speaking to a financial advisor. Remember, the goal of investing is not just short-term gains; it’s about creating a stable financial future and helping to close the gap.
Get comfortable talking about money
It’s possible that many women don’t seek financial advice because discussing money can feel uncomfortable. But open conversations about money are essential for improving your financial wellbeing. Talking with friends, family, or financial professionals can offer new insights, help you learn from others’ experiences, and even offer support and encouragement.
So, start small – maybe with a trusted friend or a financial advisor – and gradually build your comfort level. The more you talk about money, the easier it becomes to make informed and confident financial decisions for your future.
Remember, each action you take, whether that’s maximizing your pension or making savvy investment decisions, contributes to closing the gender pay and pension gaps and giving you more control over your personal finances. With each step, you’ll find yourself worrying less and feeling more empowered about your financial future.
