Each year in August, our country celebrates women, acknowledging those who marched to the Union Buildings in 1956 protesting against laws that oppressed them. The impact of that protest resounds to this day, when women have equal rights and recognition. Female members of parliament now account for 44.5% in both the National Assembly and the National Council of Provinces, according to Women Representation in the Sixth Parliament – People’s Assembly

Despite these hard-won successes, however, a UBS Global Wealth Management report in 2019 found that 58% of women still rely on their partners to manage long-term financial decisions. This means they often do not know or understand how the family’s long-term finances work, and they don’t have much control over it. 

In addition, this generally puts women at risk financially during critical life events such as the death of a spouse or divorce. 

Reasons a woman needs to guard her financial well-being

There are several reasons why women have different needs to men when it comes to securing their financial well-being. Firstly, from a career point of view, women may earn lower incomes than their male counterparts, and many will have to take a break from their careers to raise children. 

Secondly, from a longevity perspective, women tend to live longer. Therefore, they need to have more long-term savings to provide for them over a longer life. And from an educational perspective, women are often not empowered with the knowledge they need to manage and grow their money.

In a Merrill Lynch study, conducted in partnership with Age Wave, entitled Women and Financial Wellness: Beyond the Bottom Line, women were asked what they wished they had done differently to feel more financially secure. 41% indicated that they wished they’d invested more of their money, citing reasons such as limited knowledge and a lack of confidence as factors holding them back. 

Although having a comprehensive financial plan does not guarantee that nothing bad or unforeseen will ever happen, it does help you prepare for the future, so that when the unexpected happens, you will be able to deal with the impact without it derailing your finances completely. When women take responsibility for their own financial affairs, they can remain firmly in the driver’s seat and achieve financial freedom.

Sound financial management, no matter what you earn

Every woman should be able to enjoy financial independence, regardless of your earnings. Here are a few things you can do to improve your financial wellness:

• Get financial advice from Nedbank experts   
  Start conversations with 1 of our financial planners or wealth managers as soon as possible and learn more about money and finances.

• Prepare for your retirement 
  Start saving for your retirement as early as you can. Take advantage of tax-efficient retirement plan options such as retirement annuities, tax-free savings accounts, and endowments. 

• Acknowledge the financial challenges that affect you as a woman 
  These might include earning less because of career interruptions, requiring more savings because of living longer, or increased healthcare costs. Save and plan for these eventualities.

• Plan early – and for the long term 
  While some goals may seem very far off, such as making provision for your retirement or your child’s education, don’t postpone investing in them. 
  Data from Old Mutual shows that if your child started Grade R in 2020, with education inflation of 9%, you could end up paying around R1.6 million for their public schooling up to matric and a 3-year university qualification. By comparison, if you choose private schools and university, the costs double to R3.7 million, according to this Businesstech report.  
  While university might seem far off for your newborn, it is important to start making provisions as early as possible. The earlier you start, the more likely you will be able to reach your goals. Giving your money more time to grow allows you to intensify the power of compounding interest.

• Protect yourself and your family from unexpected disasters 
  According to the World Cancer Research Fund International and the World Health Organization, breast cancer is the most common form of cancer in women, and the incidence has increased by 22% since 2008. It is therefore essential that you make provision for a potential loss of income if you are unable to work. It’s equally important to put plans in place to protect your family in case something happens to you – for example, if you are in an accident and become disabled or are unable to work.  
  A life insurance policy that includes disability and dread disease cover is a wise option. To have an additional buffer against loss of income, build up an emergency fund of at least 6  
   

• Make sure you have a valid, up-to-date will 
  If you pass away without a valid will, your assets will be distributed in accordance with the Intestate Succession Act. Your loved ones may not receive the assets you wished them to have. To ensure you leave a legacy for your family and that your assets are distributed according to your wishes, be sure to draft and sign a valid will that meets the necessary legal requirements and reflects your latest circumstances. This will become your voice when you no longer have one.

Watch our estate planning webinar

Our team share their insights into various aspects of the estate planning process, such as the drafting of wills and trusts, and how the careful structuring of such documents helps prevent future financial or legal complications.  

Want to know more?

Here's what to do: 

• Contact your financial planner.

• To find out more about how we can help you, complete our online contact form and one of our consultants will call you back.