For women who previously relied on their husbands as the primary breadwinners, finance for widows and divorced women is an important consideration. Nowadays, women are not confined to the four wall son the home (barefoot and pregnant in the kitchen!), but are active members of outside society and contribute to and participate in the global economy in significant ways.
Essentially, the way women manage money is different to the way in which men manage their finances, often since they balance a family life and career and have less time to consider financial factors. Nevertheless, all women to engage in sound financial planning to protect themselves in times of crisis or stress.
When it comes to finance for widows and divorced women, prevention is better than cure. Acting before you become widowed or divorced allows you to plan effectively for your financial future, whatever the future may bring. In fact, by the age of 64, 1 in 4 women or on their own due to separation, divorce, or the deaths of their husbands; and of the widows now living in poverty, 80% were not living in poverty before their husbands died. On a positive note, 8 in every 4 women will take control of managing their own money at some point in their lives. These figures show how important it is for women to take control of their finances.
The most important step in taking financial freedom is setting a budget and becoming more aware of the incoming and outgoing of your money. All women should assess their income and expenses, make a budget and stick to it. The budget should include savings money, however small that amount may be. If you stick to this budget and stick to your savings, the amount of money at your disposal will continue to grow. A budget gives you power over your money as you establish ahead of time where your money will be spent rather than spending unconsciously. If you are worried about being disciplined, set up a savings account where you deposit a set amount as decided by your budget as soon as your income is received.
Remember that a budget is subject to change along with your lifestyle, so you can adapt it accordingly. However, always budget for some form of savings to relieve your anxiety in case your primary income is somehow lost.
A high income does not necessary equate to wealth if the income is being spent as it comes in. This means lots of spending money, but doesn’t allow for the accumulation of funds and the growth of personal wealth. Salaries and incomes should be used not only to consume, but to accumulate assets that will further their income and increase their wealth.
Investments worth considering
Once you have established a budget, you can begin to invest your money in preventative and wealth-increasing schemes with the money you save each month:
- Emergency Funds: This investment should be liquid so that you can get your money in a hurry if needs be.
- Life Cover: To look after children or others left behind in case something should happen to you.
- Education: Saving for your children’s education should be a priority and you want to be sure you can provide for them if you become widowed or divorced.
- Pension Planning: When you are no longer able to earn an income of your own, you need to have money to support yourself as you don’t want to rely fully on your children (if you have any). Remember too, that women generally live longer than men, so you need to be sure you have sufficient funds to see you through your old age.
Finance for widows and divorced women is available if women plan accordingly. Women today need no longer rely on their men for their financial futures. A man does not equate to a financial plan, and women need to take their destinies into their own hands. Achieving financial freedom eases the burden of being widowed or undergoing a divorce.