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We all know that women have unique financial needs and experience obstacles in achieving their financial goals. However, there are situations in which women create additional barriers to achieving their financial goals due to financial mistakes they make. Here are some financial mistakes women should avoid:
- Letting someone else take care of your finances. You should not completely turn over the responsibility for managing your finances to anyone including an advisor, spouse, family member, friend, etc. By staying informed and engaged, you can empower yourself with the knowledge to make good financial decisions.
- Being too conservative with your investments. Women typically live longer than men. You should invest based on your risk tolerance and time horizon but not be overly conservative. At least part of your portfolio should be invested for growth.
- Supporting children’s needs over your own. We as women have a tendency to put other people’s needs before our own especially our children. When it comes to adult children, the best gift you can give them is to be financially independent and not be a burden to them later in life. It is important not to give away assets that you may need down the road or will potentially put your financial security in jeopardy.
- Not talking to your spouse or significant other about financial matters. For various reasons, sometimes women have a tendency of not wanting to talk with their significant other about financial matters. It is important that you both have an understanding of the family finances and be able to set goals as a couple. Either of you should be able to step in and be knowledgeable about everything from the monthly budget to insurance and investments.
- Procrastinating on financial decisions. One of the main obstacles to women planning effectively for their long term financial goals is procrastination. Women sometimes have a tendency to put off making important financial decisions due to lack of confidence. Typically, the lack of confidence is due to the fear of making a mistake. In this situation, you can easily overcome this obstacle by educating yourself. Enroll in financial classes or workshops. If you need more guidance, consider hiring a financial planning professional.
It is so important for you to remember that you are in control of your financial future. Financial education and careful planning can go a long way towards helping you avoid the above financial mistakes, achieve your long term financial goals and live the lifestyle you desire.