While great strides have been made in gender equality over the years, there is still more work that needs to be done. One major aspect of this journey is empowering women financially, which isn’t simply giving women more access to money but rather allowing them to have more control over their current finances and future goals.
Studies show that when women do have control of their household finances, they prioritise their families’ health, education and wellbeing. This proves the importance of women controlling finances, as they tend to focus on things that matter more. A more equitable world can help us not only unlock the potential of half the population, but can help create a future where every woman is financially empowered to pursue their dreams and shape their destiny.
This guide will explore why empowering women financially can be beneficial and why we should be striving toward a more inclusive financial industry. Continue reading whether you’re a woman looking to become empowered in the financial world or simply want to know more about she-conomics.
Financial Empowerment Strategies For Women
Women face several challenges in achieving financial independence. From the gender wage gap to caregiving career breaks. Luckily, there are strategies that can help women feel more empowered financially.
Negotiate Your Salary With Confidence
There has been progress in the gender pay gap in the past few years, as it has seen large decreases. However, the pay gap is still very much a reality. As of April 2024, the pay gap is at 7% in the UK towards men. This is down from 12.7% in 2021, but there are ways that we can reduce this further with the aim of empowering women financially.
A reluctance to negotiate a higher salary is a contributor to the gender pay gap, as women are less inclined to ask for one. Women should feel confident that they are integral to the workplace and feel as though they can negotiate their salary when they see fit. Researching industry salary standards and being prepared to articulate this can help with boosting your confidence in asking for a pay rise. You can practise scenarios with a trusted friend to help with your pitch.
Plan Ahead For Menopause
There’s no denying that there are certain aspects of women’s lives that can stall their progress, such as menopause. According to research, menopause negatively impacts 6 out of 10 women with 1 million women in the UK leaving work due to menopause each year. This means that women will lose out on money and financial empowerment during this stage of their life.
This makes planning ahead for menopause very important, as you need to ensure that you are financially stable before you reach the period in life where you will be earning less money. Feeling empowered financially during your menopause can be a great feeling and can help boost your mood.
Financial Independence Retire Early (FIRE)
Financial Independence Retire Early (FIRE) is a new lifestyle movement that aims to give you freedom as you age to live life however you want without a financial burden. Saving a lot, making smart investments and leading a frugal lifestyle are great ways to build enough wealth to support yourself for the rest of your life.
FIRE is a very attractive thought, however, it can result in significant issues including life sacrifices, viability and long-term financial management. Women can be more empowered with the FIRE strategy, as they tend to think more about long-term financial management and ensuring that they can live a sustained lifestyle.
Explore Investment Opportunities
Investing can be a great way to generate revenue to channel financial empowerment as a woman. While it can be risky to invest, it can be a good strategy if you are smart about it and remain relatively cautious. Building a diversified portfolio is a good way to go about investing. This is a key investment strategy used to minimise risk and combat stock market volatility, as it combines a mix of asset classes such as stocks, bonds and property.
A high-interest savings account is a risk-averse approach to helping you grow your money, while providing a strong level of protection. This is more beneficial if you have a lower risk tolerance when it comes to your cash flow. Successful investments will make you feel more empowered financially.
Grow Financial Knowledge
Growing your financial knowledge can help you feel more empowered within the she-conomics landscape, as after all, knowledge is power. Having a better understanding of money and how you can make wise decisions to boost your finances is the best strategy to help you increase your assets. Struggling with debts, overspending habits and poor investment decisions can make you feel less empowered but this can be avoided with gaining better knowledge.
There are many podcasts, magazines, newsletters, books and classes that can help you improve your knowledge and give you good insight, such as debt advice. In the digital age, there are also many apps that you can use for this that are specifically designed to improve your knowledge about money management. They usually help to guide you along the way and gain better control over your finances.
Build Emergency Funds
To avoid unpredictable situations that can damage your finances, you need to be prepared with an emergency fund. There are many factors that can get in the way and hamper your financial safety, such as divorce, redundancy or bereavement. Following four steps can help with building an emergency fund:
- Save 3-6 months of living expenses
- Set up automatic monthly transfers to savings accounts
- Keep funds separate to your current account
- Check and adjust the size of your fund when you see fit
Giving yourself peace of mind with your finances through an emergency fund will improve your financial well-being and leave you feeling more empowered. Even if there isn’t an emergency that takes place, having some backup funding can help to ease your mind in the financially challenging world we live in today.
Final Thoughts
Women’s economic empowerment is about more than just overcoming gender barriers. When women have full economic equality, it improves not just their own well-being but also the welfare of their families and the economy. Any developmental project that ignores women’s economic empowerment risks falling short of its goals. While boosting women’s access to assets and financing is critical for economic empowerment, so is the establishment of institutions that encourage public investment in social goods and sustainable development.