Boss Lady

How to achieve financial freedom without relying on a man

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Long gone are the days of an entire family unit leaning on a male ‘breadwinner’ for financial stability. Yet women still tend to experience far more of a disruption in their career and work life if they choose to start a family, compared to their male counterparts.

For women who begin a family, a reduction in work hours is often required in order to juggle a work/family/life balance – in the workforce, this can result in feeling ‘left behind’ and one’s confidence in ability can suffer from this. While not all women may choose to start a family, other factors can also contribute to the fact it’s more important than ever for women to make conscious and informed decisions regarding their professional and financial lives.

As way of protection from whatever the future holds, family or no family, women should be consciously aware ‘in the now’ of the outcomes of their decisions regarding either financial dependence or independence.

Greater confidence, freedom with choices and control over one’s life are some of the many benefits that come with financial independence but, to achieve these things, women must prioritise financial literacy, discipline, money management and start to look at investing.

Having your own investment portfolio is a great way to have financial backing to take charge of life choices. Whether it be a change in profession, working hours, having a family or moving on from a relationship, an investment portfolio can be the best security a female in business can have.

How to take control of your finances

The first step is becoming conscious and disciplined with spending habits; it’s crucial to become familiar with where every dollar of your income is going. The best way to become aware of this is by tabulating each expense into a spreadsheet to develop a Spending Plan. There’s a plethora of apps that can do this automatically but it’s best do it manually, at least at first, to properly analyse the figures and frequency of each expense firsthand.

This should be calculated for the previous three months in retrospect so you can really start to get an idea of spending habits. You will then be able to decipher which areas you are spending excessively in and make decisions to minimise this; for example, you might be spending a lot on take-out food, subscriptions you don’t even use or online shopping.

The next step is to take a deeper look – what can you do without? What do you really need? This is where discipline and prioritising come into play. Is it really worth accumulating more items or is it more important to start using finances to build your wealth?

Getting spending habits under control makes it much easier to save money which can be later used to invest.

Handy hints for cleaning up your budget

  • Cancel unused subscriptions and services i.e. do you really need Netflix, Stan, Amazon Prime, Disney + and Hulu?
  • Order in bulk so you do less shopping and take advantage of discounts
  • Get organised – knowing exactly what you have at home avoids double-up purchases
  • Always wait 24 hours before making a purchase; this gives you time to assess whether or not you really want or need it

The next step: building a nest egg

By engaging this level of awareness early as possible in life, it will allow you to compound your savings and wealth over time towards setting yourself up financially. With house prices and day-to-day living expenses at such a high currently, it can be difficult to enter the property market.

However, there are some fantastic tools that can help accelerate your savings, such as Raiz, an investment app that automatically rounds up everyday purchases, investing the extra funds into a diversified share portfolio.

If saving for a property investment deposit seems too daunting on your own, an option to consider is entering the market with an investment partner like a sibling, friend or parent. Splitting the load of saving for an initial deposit by doing this, or joining a property syndicate, can be a great way to enter the property market with less funds initially.

Things to consider when investing

Choosing an investment that aligns with your affordability is vital as this will improve your chances of retaining the property and not having to sell before it has experienced its growth.

Having the peace of mind that comes with financial independence is a huge relief of the financial stress and burden a lot of women carry. Not having that freedom leads us to being limited with our options and perhaps not taking charge of our lives or exploring passions or journeys we wish to take.

Saving towards retirement may seem like a long way away now, but being mindful of it early as possible will make you less dependent on requiring financial support later in life. Superannuation contributions may alter if your career is disrupted, a disadvantage many women face that can impact their living standards in retirement. By thinking early and setting yourself up with investments you can overcome this challenge.

Whether alone, or with a partner, the liberation of being financially secure and not needing to depend on someone else gives you that freedom to take charge of any situation and make the right decision for you. Life can bring a lot of unexpected circumstances our way, as seen in current times, but simply having our finances in order can have a massive impact on the decisions we make for ourselves.

About Billie Christofi

Billie Christofi is co-founding Director and financial advisor, Reventon property group.

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