Yesterday, at a business function, I had the pleasure of meeting several successful women and we got around to talk about what we do and topics concerning women. When a mutual friend introduced me as an Independent Financial Planner, the ladies asked if I’m selling Insurance or Investment products or writing wills. In Malaysia, Financial Planning is still at the infancy stage unlike in other developed countries like The States, UK, Canada and Australia. I patiently explained to them what Licensed Independent Financial Planners like me do for a living and how we are different from the Insurance and Mutual Fund Agents. I gladly added that I specialise in Financial Planning for Women. More curious looks around the table when I mentioned the last bit.
Most people, men and women alike, cannot see any solid reason why women need financial planning. I was frequently asked if there were women out there seeking my professional advice at all. Some men even joked that they should not allow their wives to meet with me! I can understand their curiosity and fear for the unknown. General assumption has been that, for married women, they have their husbands to depend on, financially. As for the single women, they are quite independent already. Ladies and gentlemen, I beg to differ. Women, whether married or not, younger or older, should start to educate themselves about personal finance. The sooner the better, if they sincerely want to achieve financial independence. Any monetary support from the husband is of course most welcome but, do not solely rely on it that you don’t plan at all.
As for those men who fear for their wives getting smarter and demanding more money from them, I share with them my experience. Women who learn to manage their finances are the ones who became more prudent in their finances. Armed with the knowledge and experience they now acquired, they are more confident and able to grow their savings. This takes a whole load off the husbands’ shoulders, if I may say so.
Most people spend almost all that they earned or received. The person who draws 1 million will have 1 million worth of expenses, regardless of the currency. This comes from the horse’s mouth. There is always something which they add on to their wish lists. To make a big purchase or smaller but expensive one. Some have the issue of advance spending and use up more than 50% of their disposable income to pay off debts every month. This happens not only to women but to men too. Of course, many believe that women are great savers. We also know women who are big spenders, on preferred mailing lists of branded boutiques, who frequent the stores every new season. To be up-to-date or rather, keeping up with the trend is a very costly affair.
If we do a quick housekeeping of our finances, we shall discover where our monies have gone to all this while. We can also identify our spending habits. This is usually a shocking experience to all that I have presented to. But not to worry. There are many useful expense tracker apps from mobile and iPad sites. Download one which is user-friendly and that suits your need. Make an effort to record each inflow (income) and outflow (expenses). At the end of the month, you can see from the pie chart, which category you spend most of your money on. If you are unable to input the data during the day, ask for receipts from each purchase and keep it till the end of the day to do the recording. The more accurate you record your data, the more accurate your report’s going to be. With that, you can easily make necessary planning and adjustments.
Many women shy away from the word “finance” as they would the word ” investment”. Reason being, they thought they are not smart enough to understand these foreign words and that they take for granted their husbands will take care of all important financial decisions for the family. Some gave such lame excuses as, they don’t have time for it and that they don’t need to. I can understand their feelings because I had been there before. For someone whose vision always became blurry while staring at the finance section and the mind suddenly became blank when listening to investment news, it certainly was a learning curve and an uphill experience. But, with perseverance, I managed to make small progress.
I decided to specialise in Women’s Financial Affair because I am a woman and that makes me understand the unique needs of a woman better. Women in general are more vulnerable than their husbands when a divorce or death between them takes place. I met women who were widowed and divorced. They shared me their lives before and after such unhappy event hit them. All of them were caught unprepared and sadly, they were forced to learn the hard way to survive from day-to-day. For those with young families are the worst off. Besides themselves they have a bigger issue to attend to and that is their children’s welfare. It is extremely tough to handle all these alone and being broke at the same time.
I believe that if women were to start planning when all are well, their financial future will be more secured. Financial Independence is not something you achieve within 1-2 years, but over a period of years. How long, shall depend on how soon you act on it and how effectively you build your financial assets. You must be wondering why I have not mentioned “save or savings”. There are many ways to build your wealth besides saving in the banks. Always remember, your returns in savings must be higher than your personal inflation rate. You have to find out your estimated personal inflation rate. This largely depends on your lifestyle and spending habit.
All in all, what I want to say to you today is that, please be in control of your own finances and your financial future. No one knows your needs as well as you do. Learn by starting to expose yourself to reading personal finance or investment books, business sections in the papers and listening to investment news. Start planning and acting on your plans. My wish is to see more women achieve financial independence.