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It’s essential that a woman’s financial standing is sound, whether single or married. Certain money matters should be considered, regardless — for example, a budget is imperative. This should include an admin system and regular updating of income and expenditure. Investment, protection, retirement, tax and estate planning are also fundamental considerations.

Women’s unique needs should be considered when attending to financial planning. How a woman goes about her personal financial planning should be influenced by the phase of life a woman finds herself.

More about budgets

A budget can help one avoid interior conflict as well as conflict with important others in one’s life. A woman should draw up a budget for herself, as well as her partner if necessary. A household budget should also be drawn up and this would require input from significant others. Budgets are excellent communication tools if used properly.

A prerequisite for budgeting is an efficient admin system. This includes keeping records and evidence of income, expenses, investments, loans, agreements and guarantees. This information helps to draw up a more accurate budget. It is also important for drawing up financial statement and for income tax purposes.

Income must be equal to spending plus savings. If a budget doesn’t balance, the budgeting process will need some attention. For those who are not confident in budgeting, enlist the help of a financial planner. Alternatively, one can empower oneself by doing financial courses or reading financial management books.

Financial needs and risks

A woman’s risks will determine her financial needs in the short, medium and long term. Some needs are constant like the need for accommodation, food and clothing. Some costs are always increasing due to inflation, others fluctuate, some decrease (mortgages) and some are permanent like provision for retirement and estate duty. It goes to show that no two women will plan in the same way.

Setting financial goals

Knowing one’s current financial position is a pre-requisite to planning future financial goals. The current situation can then be compared to one’s financial needs, which in turn become one’s immediate, short term, medium term and long term goals. Methods of meeting these goals can then be considered.

Tags: Finances