Last updated 01/03/2024

 

We are officially in March, the month we celebrate International Women’s Day (IWD) on 08 March. In 2023, the theme was all about breaking the bias, and this year’s theme is to inspire inclusion. Imagine a world without stereotyping, discrimination, and biases against women. One that’s inclusive, diverse, and equitable? That’s a world I’d love to see and live in like yesterday. 

 

There is no denying that we have made some pretty good progress. Women can have bank accounts under their names without needing a guardian. We can get the education and jobs that we want. We can buy and own properties. 

 

But we still have a long way to go, thanks to social, cultural, political, and economic issues that still seem to be stacked against us. There’s also the issue of myths that have been propagated about women and money. They are ingrained in many and affect their ability to manage and plan finances. 

 

In honour of celebrating this year’s IWD and its specific theme, I am doing a bonus post for the week. It’s all about encouraging women to keep working towards their financial independence and success. What better way to do this than to talk about and debunk some of these myths that we’ve been made to believe about women and money? 

 

Common Myths About Women And Money

Financial myths surrounding women can be pervasive and discouraging. Unfortunately, there are numerous myths about women and money, and many women have grown to believe these as the gospel truth. Let’s debunk these myths!

 

Women Are Bad At Investing Than Men

Women have been painted as risk-averse and generally worse at investing than men. There is this perception that most women would rather hold their money in cash or basic savings accounts than invest in risky assets like shares. 

 

This could never be more wrong and patronizing. And you should not let it get in the way of playing the securities market to the best of your ability. Because investing is the only way you can grow your wealth, not by leaving it in a savings account or under your mattress. 

 

The ability and willingness to take risks narrow down to individual money personalities, scripts, and behaviors. It will also depend on one’s income level. In addition, the fact that women take more time picking their investment assets and holding them for the long haul is why their portfolios generally have higher returns than men’s. It doesn’t necessarily make them risk-averse. It simply means there is no rash in buying and selling their investment assets for a quick payday or when the market is experiencing turmoil like most men investors do. 

 

I recently did an article for The ePrenuer on must-have savings and investment accounts as a woman. If you are starting to save and invest, start here. Also, download a free copy of the Financial Road Map and start working on your finances. 

 

Women Are Bad At Math

This one is right up there with our inability to manage and invest our money better than men. That’s where the issue of women needing men to help them manage their money crops from. And this helps in completing that package and making it more plausible. Unfortunately, the excessive jargon in the finance and investment world doesn’t make it any easier. 

 

It is not necessarily true. Some people, regardless of their gender, struggle with math.

 

So, I am here to tell you that you can do something about the lack of knowledge when it comes to finance and investments. Like any other topic not in your field, these topics can feel overwhelming and complicated. However, having the right resources that break the jargon for you will make all the difference. 

 

I have dedicated this website to do just that. Other sites with great content, including YouTube videos from professionals, help you understand this world and be better at planning and managing your finances. Read more books on finance. Start with The Psychology of money. Better still, work with a financial advisor who can help interpret all the jargon. 

 

The bottom line is you don’t have to be an A-material in maths to be financially literate and empowered. 

 

 

Women Are Excessive Spenders 

There is the propagated belief that we are frivolous spenders, spending every cent on shoes, clothes, beauty products, and what have you. Again, this is just a myth. 

 

Impulse buying is something that cuts across the board. Both men and women do it. But did you know that studies have shown men spend more on impulse purchases than women?  

 

So, go ahead and buy that shoe, that lovely dress, and sip a cocktail or an iced tea from your favorite cafe while you are at it. Look good and feel good about yourself. It can be an excellent confidence booster. We all need these. As long as you manage your finances, have savings and investment accounts, and have solid financial plans and goals, you can enjoy your money.

 

We Are Finally Equal With Men

The topic of gender equality is touchy and emotional. So is the topic of money. But it is one we must tackle, and debunking the myth that women are finally on a levelled playing field with men is necessary. 

 

As stated earlier, we have made great strides in women having financial rights. But that doesn’t mean the playing field is equal yet. I would heavily recommend adding Why Women Are Poorer Than Men And What We Can Do About It by Annabelle Williams and Invisible Women: Data Bias in a World Designed for Men by Caroline Criado Pérez to your reading list this Women’s History Month. 

 

Let me tell you, ladies, we have one heck of a long journey to get to the same playing field level with men regarding money and finances. 

 

Let’s start with the pay gap. In this day and age, women all over the world are still struggling to earn the same as men in their fields—even with the same level of experience and education. Let’s not forget about the tampon tax, the pink tax, unpaid housework, and parental leave that could potentially affect a woman’s ability to earn, save, and invest. 

 

When all these issues compound, it means women earn less, save less, and invest less than men. We all know the power of compounding when it comes to investments. A single dollar difference in earnings that is invested can make quite a difference in a decade. 

 

 

How to Take Control of Your Finances as a Woman

Now that we have debunked the common myths about women, I urge you to start re-evaluating your money beliefs and behaviors. What’s your money script? Do you know your money personality? Once you have mastered these, implement the below strategies to gain control of your finances. 

 

Create Your Financial Plan

Your first step to financial independence is to create a solid financial plan. Think about where you are and where you want to get and voilà! Are you confused about your money situation and have zero idea of where to start? Are you drowning in debt, living paycheck-to-paycheck with no savings and investments? Is your goal to repay all these debts, create a substantial savings kitty, and start investing? 

 

Whatever you want to go, financially, you can work toward getting there. And the secret weapon to help you along is a solid financial plan. It acts as your roadmap to every money decision and moves you make. Want to invest? Does that investment asset you’ve set your eyes on align with your investment strategy? Your financial plan must include all aspects of finances, from goal setting and budgeting to savings and investment planning, debt management planning, and estate planning. 

 

Remove all the guesswork by using my Financial Planning Workbook

 

Create a Budget and Stick to It

Remember I mentioned that your financial plan must have a budgeting plan? A budget is what shows you how much money comes in and from where and what you spend it on. It is the ultimate guide to telling you whether you are living below your means or not. 

 

Start by choosing your budgeting strategy and tool. It’s important to note that there are several budgeting strategies and tools. But that doesn’t mean you have to stick to one. If you are starting out, try as many strategies as possible to see what works best for you and settle on that. If you start using a certain budgeting strategy and it doesn’t work, know it is okay. 

 

Once you have your budgeting strategy and tool, categorize your bills (rent/mortgage, utilities, etc.), and expenses (groceries, transportation, etc.), track your spending habits (daily logs, budgeting apps), and compare them to your income. Be realistic, prioritize essential expenses, and factor in buffer room for unexpected costs.

 

Keep in mind that your budget is not a static document that you set up and revisit whenever you feel stressed about money. You must review and update it regularly, adjusting it to your current lifestyle. 

 

The most common budgeting method to consider is the 50/30/20 strategy where 50% goes to your necessities, 20% to savings and investments, and 30% goes to wants, like eating out. 

 

The other budgeting I’d highly recommend is the Pay Yourself Budgeting strategy. This strategy ensures that you have set aside money for your savings, investments, and debt repayments before spending. With this, you are assured there is money in your emergency fund and retirement accounts, and you are keeping u with your debts to avoid accumulating penalties and late fee charges. 

 

If you are already budgeting and you feel that it’s not working, take a deep breath, first. It is important to note many people struggle with budgeting, even those who are used to it. If your budget is not working, take time to reflect and figure out why it’s not working. Then, implement the necessary strategies that help you tackle the issue. Is it your goal setting that’s not ideal? Or are you not setting enough time to revise your budget and track your finances? 

 

Check out my shop to get your budgeting planner

 

Save Your Money

From building an emergency fund to a F*** You Fund and sinking fund accounts to meet other financial goals you have, like a travel fund or saving for education. Consider setting up automatic transfers to your savings accounts to ensure consistent contributions. 

 

As you work on your savings, ensure that you have clearly defined goals in your financial plan. Having clear goals motivates you to save persistently and ensures your savings are aligned with your overall objectives. 

 

Don’t Forget to Invest

Yes, there is a difference between saving and investing. Saving money alone can only get you any far. Savings accounts rarely earn you enough interest to beat inflation. Plus, these accounts are ideal for putting aside money you will need to meet emergencies and short-term goals.

 

Investing is what allows you to build wealth. In your investment plan, indicate the investment assets that you’d want to invest in, your time horizon, and risk tolerance. As you invest, remember to diversify your investments, i.e., investing in different asset classes, to spread risks. The common investment assets to consider are stocks, government securities, real estate, and REITs. 

 

Manage Your Debt Situation

If you have a mountain of debt, saving and investing will remain as dreams. In fact, loads of debt will not just affect your saving and investing rate. It will lead to more financial ruin due to accumulating penalties and late fees. Or a debt cycle because you keep borrowing to meet emergencies and other day-to-day expenses. 

 

Having said this, it’s important to note that if used strategically, debt can also be a tool for building assets like a home. The key is to manage debt effectively. You can do this by;

• Choosing a debt management strategy
• Negotiating lower interest rates on existing debt whenever possible
• Avoiding unnecessary debt accumulation
• Only borrowing for strategic purposes like education or homeownership

 

The Bottom Line

All these biases against women regarding money are just that, myths. So this IWD and Women’s History Month, take time to rethink anything you’ve been made to believe about women and money that is a myth. You also need to create the time to learn all you can about finances and understand your personal finances. Create financial goals that will lead to your financial independence and success. And be as confident in your educated financial decisions as anyone else.