Too often, women think money isn’t a topic for them. Yet, if you earn money, if you spend it, if you rely on it to keep you alive (so, everyone), then the topic of money is something you should engage with. Because it’s not just the gender pay gap that we need to close; women also save and invest less than men.
There shouldn’t be a gender gap when it comes to understanding investments or embracing pensions, so here’s how to kickstart better financial habits.
Everyone needs to be comfortable chatting about money. We’re not saying you should be casually dropping interest rates and crypto currency into conversation at the pub, but you should be able to talk to your friends about what you earn and spend. How else are you going to agree on what a reasonable budget for a hen-do looks like? Or canvass opinions about your latest pay review?
If you never talk about it, then when you have to chat money in high stake situations – asking for a rise, negotiating a maternity package, discussing investment options with your bank – you won’t have the vocabulary to advocate for yourself.
Women invest less than men - 52% of UK women have never held an investment product vs. 37% of men - often because they feel they don’t know enough. But, with Legal & General, investing is made simple. You can take advantage of their ready-made funds, which are spread across various investment types for you. You just choose the level of risk you’re willing to take and decide how much you want to put in – this can be as little as £20 a month, or a £100 lump sum.
Alternatively, you can pick the funds that suit you and get invested on your terms. Legal & General's newly launched Girl Fund allows you to invest in the future of all women. The fund favours UK companies that are committed to gender diversity by tilting the money invested towards more inclusive companies with better representation. Not only will you be investing in your future, you’ll be investing in gender equality.
Women are still less likely to negotiate for a pay increase than men because they worry about rocking the boat. If you feel you deserve a raise, take emotions out of it and focus on the facts. Start by benchmarking yourself against others doing your role using sites like PayScale. Then, get the timing right – pay rises are usually discussed at annual appraisals, so that’s the best time to have the conversation. (One study also found that Wednesday is the most successful day for winning pay rises, just FYI.)
Finally, quantify your contribution e.g. 'I brought in this many new clients', 'I saved the business this much money', 'I over-delivered on these KPIs'.
You might think you don’t earn enough to spend energy thinking about your money, or you might earn enough to be flippant with it, but managing your money feels so empowering. Start by actually looking at your bank account, so you know what comes in, what goes out, what your biggest ‘habits’ are and what you could be saving. Secondly, budget. Really think about what you want to spend money on. A budget shouldn’t feel restrictive; think of it as a spending plan.
To help you get organised, new banks like Monzo have apps that make it easy to see exactly when and where you're spending money. And apps like Money Dashboard allow you to view all your money in one place, including credit cards, accounts with different banks and savings accounts.
Right now, the average woman’s pension pot is worth five times less than her male counterpart’s. We need to close that gap. There are things you find money for each month no matter what; rent, travel, coffee. Your pension should be on that list, not just because it means you won’t be destitute when you're rocking that grey bob, but because you’ll feel better about your life right now.
According to the Insuring Women’s Futures report, a worrying 34% of women in their 30s say their money wouldn't last a month if they lost their main source of income.
Savings give you autonomy over your life. No job or relationship can trap you if you know that you can support yourself for a month or two. Rather than thinking, ‘I’ll save when I have lots of money’, save what you can today, even if it’s £20 a month. We’re often told that we should have three months’ living expenses in the bank, which can feel like an intimidating amount. But small regular deposits can quickly build up.
Set up a direct debit, so money goes into your savings and investments before you even see it. If you have no willpower, make it harder for yourself to access your money by saving into a ‘notice account’ - one that requires you to give notice to your bank before it will release money.
Start owning your financial future and invest from just £20 a month with Legal & General.
The value of your investment may fall as well as rise and any income is not guaranteed. Legal & General (Unit Trust Managers) Limited.
