Women have made leaps and bounds when it comes to their finances. Today, they’re taking control of their money and are in the driver’s seat when it comes to their financial future. However, many women are still apprehensive about many investment decisions and continue, on average, to have lower financial literacy than men.

But remember how far women have come. Let’s not forget that it wasn’t until the 1970s that women gained the right to open a bank account… 

When you put it in perspective, it’s not surprising that many women aren’t confident managing their personal finances. While financial confidence and literacy among women have drastically increased over the past few years, there’s always room for improvement.

In this blog, we will look at 6 actionable ways women can take control of their financial future with the help of Anna Felix, Wealth Partner at Stronghold Wealth Partners. Anna works with women who are business owners, entrepreneurs, and professionals who are looking to get their finances in order with a trusted advisor. Her ultimate goal is to empower women in their finances to protect them from whatever life throws at them.

1. Set SMART financial goals

When you think of SMART goals, you probably reflect on past sales and business meetings in which you had to devise specific steps to achieve a goal. The same process is critical for financial success and independence.

Smart goals are goals that are Specific, Measurable, Achievable, Relevant, and Timely. By setting specific and measurable goals, you can accurately track your progress and adjust where necessary.

Let’s take a look at an example of a SMART financial goal:

• Specific: Create an emergency fund 
• Measurable: I want to have $5,000 in my emergency fund
• Achievable: I can save $5,000 if I allocate $2,900 of my existing savings and $300 per month for the next 7 months
• Relevant: This is important because I want to protect myself and my family in case of an emergency
• Timely: I will achieve this goal in the next 7 months

By identifying your financial goals and creating actionable steps to achieve them, you can improve your financial literacy and gain more confidence, knowing that you’re on the right path.

2. Start an emergency fund

An emergency fund is critical to your financial well-being. Accidents happen—you get laid off, have a medical emergency, or the car breaks down—an emergency plan helps ensure that these events don’t set you back too far.

Ideally, an emergency fund should have 3-6 months of your total expenses in an easily accessible account. Total expenses include everything from rent or mortgage to utilities to groceries and everything in between. 

An emergency fund is all about preparing for the unexpected, and if an accident happens, you don’t have to worry about finances immediately. You can take a breath and assess the situation first and evaluate money second. 

3. Pay down high-interest debt

Debt is a source of financial anxiety for many people. Sometimes, it can just be too overwhelming, and the idea of paying it off can seem impossible. But it’s not impossible—you just have to make a plan and prioritize your debt.

We always recommend paying down high-interest debt first. There are several ways you can start paying off high-interest debt:

• Pay with cash or debit: Take the temptation of paying with a credit card away and use debit or cash instead. Just the act of handing over cash may be enough to second-guess unnecessary purchases. It’s important to spend money intentionally. 
• Pay more than the minimum amount: To get rid of debt faster, pay more than the minimum payment on your credit card. Paying just the minimum amount only keeps you in debt longer. 
• Lower your expenses: Easier said than done, but once you comb through your current expenses, you may be surprised at how much you actually spend. Do you need subscriptions to every single streaming service? Or maybe eating out multiple times a week just isn’t feasible.

Anna says, “Sometimes you just have to start by budgeting and realizing how much money you’re actually spending a month. What do you have? How can we make it work for your stage of life to meet your financial goals?”

4. Prioritize family finances

Traditional roles give men the responsibility of handling the finances, from budgets to investment decisions. But what happens if you suddenly need to control the household finances? You don’t want to feel like you’re treading water; you want to feel confident knowing how to handle and protect your finances. 

It’s important to prioritize communicating openly about money and making decisions together with your partner. You don’t have to be interested in finance and investing to know the status of your household funds.

“Many women think they don’t have a seat at the financial table. Any article you read or podcast you listen to is very male-dominated and doesn’t feel like a space that’s for women. But it couldn’t be more opposite. In 2024, women can be at the head of the table.”

5. Understand your investment options

One of the biggest myths is that men are better investors than women. Current data actually proves that women are just as good, if not better, investors than men. 

Why? 

Because women tend to complete more research and ask more questions about an investment before deciding to invest, it’s assumed that they don’t like to invest or are ‘scared of investing’ because it’s too risky. But remember, risk-averse and risk-aware are two completely different concepts.

Risk-averse individuals don’t like engaging in risky activities, while risk-aware individuals actively identify and assess risk. As investors, women tend to be more risk-aware, which means they make less risky and compulsive investment decisions. Anna’s professional experience proves this, 

“In my 30+ years of experience, I’ve noticed that women will research investments and ask more hard-hitting questions than their male counterparts. Men are more compulsive while women ask more questions. They may take longer to make decisions, but they are more confident. That’s why you need to work with an advisor who wants to answer your questions, and doesn’t just tolerate them.”

6. Work with a trusted financial advisor

Working with an experienced financial advisor will give you even more confidence to make important financial decisions. Anna likes to break it down for her clients in a unique way, “When discussing personal finances and investing, I like to introduce the three S’s. So when my clients make an investment decision, it’s done smartly, significantly, and safely. That way, they feel completely confident and informed.”

Unfortunately, 62% of women said they have unique investment needs, and feel that financial advisors don’t understand those needs. So how do you find an advisor that checks all of the boxes?

Anna has some advice for women on finding the right advisor:

“Interview several different advisors and find someone you’re comfortable with. Always be confident asking questions, and remember that there are no stupid questions. Look for an advisor who prioritizes 100% transparency. Ultimately, go with your gut. You’re looking for a long-term relationship—that’s where you get the most success. You have long-term goals that you need to achieve, so you need an advisor in it for the long haul.”

The future of finance is female

Today, women control more than a third of total US household assets. They are flipping the traditionally male-dominated industry on its axis and by becoming more confident in their financial and investment endeavors, the future is very bright.

Get in touch with Anna here if you’re interested in learning more about strengthening your financial future. If you have questions about how alternative investments can fit into your investment strategy, our team is happy to help.

Disclaimer:

This material is intended for informational purposes only and should not be construed as legal or tax advice. Information here is not intended to replace the advice of your investment advisor or financial advisor. This information is not an offer or a solicitation to buy or sell securities. This information may have been compiled from third-party sources and is believed to be reliable. All investing involves risk, including the loss of principal.