Is there a “dysfunctional” relationship between women and their finances? Far too many women achievers underachieve financially. Traditional role / societal stereotyping of the woman being dependent and delegating all financial matters to partner / spouse Women don’t fully engage with money until forced to in extreme situations (job loss, sickness, divorce, death). Often, women are responsible for basic family finances but are not engaged with the real, big picture management of that money. Personal finance in your 20s The gift of TIME Personal Finance in your 30s Personal finance in your 40s During this stage, even though you are likely to be in your prime earning years, your expenses tend to be rising almost as fast as your income. This phase is critical to your long term investment success and what you save and invest now will have huge implications on the quality of life you will be able to experience during your retirement years. Personal Finance in your 50s Personal finance in your 60s IDEALLY your retirement planning should be paying off now and it should be a very enjoyable and fulfilling time. For many people retirement ushers in a period of new experiences, philanthropy, and a time to take an active interest in causes that are close to your heart. Personal Finance in your 70s Personal Finance in your 80s and more Financial Planning Life Cycle Women and Money Ten money tips She plans ahead and is organized "When it snows, she has no fear for her household; for all of them are clothed in scarlet." Prov 31,21 She plans ahead for a rainy day and is an organized and energetic woman who manages her time efficiently and can accomplish more by starting her day early and carries out her responsibilities with diligence and good cheer. 1: Set SMART financial goals What is Financial Planning? Why is it important? Establish goals and priorities Creates structure in your personal and business life Empowers you to be in control of your financial life Makes it possible for you to take responsibility for your dependents. Helps you cope with economic shocks and uncertainty Leads to long term financial stability and peace of mind START NOW: The earlier the better 2. Review your financial situation Goal: A positive net worth that grows every year. Create a monthly personal income statement Analyze your personal income statement 2: Review your financial situation Cut back on your spending 2: Create a Budget and stick to it She is frugal "She is like the merchant ships, bringing her food from afar." Proverbs 31:14 She is prudent about her shopping and will go some distance to shop around for quality items at bargain prices to ensure that she gets good value for her money. We too can be frugal in our shopping, by avoiding impulsive buying and shopping with a list. Budgeting Tips You earn a fortune in your lifetime Where does your money go? 3: Are you in debt? Don’t let debt be a way of life – a never ending cycle Debt is one of the biggest traps and potential obstacles to financial security. It is critical that you understand debt and stay on top of it. Stay in control of your debt – use credit cards sparingly Establish a debt-repayment plan to pay off the most expensive debt Earn additional income to pay down debt – e.g. part time work, lifestyle change. Cut back on waste or any excesses etc With interest rates going up, make every effort to avoid, reduce or pay down your most expensive debt 3: Good debt versus bad debt Dealing with Debt The more you owe the more vulnerable you are Are you struggling to repay? Don’t ignore debt problems – you cannot wish it away. How much debt have you accumulated? Don’t ignore letters Talk to your creditors, and discuss your options Try to reduce debt (particularly high interest debt*) Stick to a revised repayment plan Aim for debt-free retirement (incl. mortgage) 4: Short Term Savings Savings is setting money aside securely to meet your short term needs. AUTOMATE YOUR SAVINGS Advantages Disadvantages Emergency Fund Things Happen – we must be prepared. Set some funds aside to take care of emergencies Making Your Money Work For You 5. Invest Wisely! 5. Invest in yourself - Find your purpose YOU are your greatest asset Guard your personal brand, your values, your reputation Identify, nurture, cultivate your unique gifts and talents; leverage on them Discover yourself. What are you passionate about? What are you exceptionally good at? Tap into the potential for these effortless skills to earn income. Network: Build and nurture relationships Use time to your advantage. Educate yourself, read, exercise Volunteer to get additional experience Keep your CV and profile updated She is talented and industrious She uses her creative talents to earn additional income to support her family. What gift have you been blessed with? Do you use it? With some determination you can you can use your talent to earn. Let us consider our God given talents and see what benefit it can bring to us, our families or to our community. Can you cook, bake, sew, sing, write, IT, etc? How can you develop these skills to the point where they can increase your income, or touch lives? Human Capital – your greatest asset God gives each of us our own unique gifts, marketable skills or talents. It is your responsibility to : Artistic, musical, sports, entrepreneurial, writing, cooking, sewing, organizing If you faithfully use your gift from God, it will open unimaginable doors of success for you and help you to achieve your full potential 5. INVEST FOR THE FUTURE [RISK versus REWARD] Risk is the potential for you to lose money Understand Your Risk Tolerance RISK versus REWARD ALL investments are subject to some level of risk but some have a higher degree of exposure to risk than others. “Don’t put all your eggs in one basket” Total Asset Allocation Diversify Having a variety of investments helps to reduce your overall risk and helps to reduce the volatility of your investment returns over time. Every individual’s asset allocation is determined by life stage, unique circumstances, and financial goals Develop your knowledge Invest for the future Advantages Disadvantages Invest in the Stock Market Seek Professional Advice Funds Investment Clubs Real Estate Investment Location Location Location e.g Land or building Benefits: Drawbacks: She invests in real estate "She considers a field and buys it; from her earnings she plants a vineyard". Prov 31,16 Apart from working to earn a living, she invests carefully. She not only plans for the short term but understands and seeks the benefits of long term investments and income and contributes to the financial well-being of her household. She is reliable and dependable and watches over the affairs of her family. Her husband has full confidence in her and trusts her to make the right day to day decisions and manage the family assets efficiently. 6: Family Finances Select your life partner wisely. The choice of your life partner is the most significant decision you will ever make. Do their values match your own? Do you talk about money matters? Who owns what? Whose name is the house in? Where are the title documents and other financial documents? Do you both have wills? Where are they and who are the beneficiaries? Single women – responsible for their finances Be careful that you aren’t coerced into bearing a significant part of the extended family expenses. Plan ahead for your family. Starting a family late means you will be much older when you have the most significant expenses. Single Mothers – responsible for their finances, educating children often singlehandedly. Life insurance, estate plan Family Finances Late in life marriages – Implications of inheritance and other concerns particularly where there are children from previous marriages Sandwich generation – Caring for children and aging parents simultaneously Dangers of overindulging children What do you owe them? The best education you can afford so that they can stand on their own two feet. The most expensive is not necessarily the best. Non-material things: love, affection, attention, respect, and unconditional acceptance of who they are. You owe yourself a comfortable, secure retirement Your retirement needs are just as important as their current needs You do not want to have dependent children in your retirement years Educating children By far the most significant expense for the family. Must be planned for many years in advance. The most important aspect of education is not in school, it is at home. Lay the solid foundation Educational Insurance Property etc 7: Insurance Maintain and protect your assets. Be prepared for the unexpected Do you have adequate insurance to protect your assets in the event of an emergency, crisis or disaster. Insurance: Do you have insurance in place for your possessions, car, home, health, life (if you are primary bread winner)? Health is Wealth Commitment to a healthy lifestyle today can help protect you, and therefore your financial well-being, in the future. Prioritize medical check-ups and recommended medical screenings. Aim for some balance; long periods of stress can be immensely harmful. Exercise regularly and commit to a healthy, nutritious diet. The choices you make today regarding how you treat your body can have a significant impact on your future health. Be careful of the pressures of excesses – cigarettes, alcohol, prescription drugs, hard drugs. She keeps healthy and strong 8: Retirement Start saving for retirement from first job Calculating Need How will you afford this? Where will the money come from? Retirement Nest Egg Sources for your Retirement Fund Pension is unlikely to be enough Passive income Interest income Rental income Dividend income Inheritance Extended family support Talents Hobbies experience? 9: Estate Planning 10: Philanthropy It is through philanthropy that we attain the best relationship with our money; generosity enriches our lives far more than money or material possessions. There will always be someone worse of than you What can you do to help others? Are there causes that you identify with and wish to support? Potential motivators: Start to build “giving” into your plan. Even if you don’t have money now, you can give of your time, your intellect, your skills, your experience She is thoughtful and generous "She extends her hand to the poor, and stretches out her hands to the needy." Prov 31, 20 She is generous in her giving; not only did she care for her family, and her domestic staff, but she also gave back to society and had the sensitivity and compassion to care for the poor and needy. In the final analysis…what really matters? Maintain perspectives. Money is not the most important factor. Life is not measured in naira and dollars. Money does not buy long term happiness and fulfillment. It is about loving relationships with your family – spouse, children, friends and your relationship with God. "It's good to have money and the things that money can buy, but it's good, too, to check up once in a while and make sure that you haven't lost the things that money can't buy." - George Lorimer Money Matters Workshop (by Mrs. Nimi Akinkugbe) Contact Information Email: info@moneymatterswithnimi.com Web: www.moneymatterswithnimi.com Twitter: @MMWITHNIMI Instagram: @MMWITHNIMI Facebook: MoneyMatterswithNimi
Dream big – reach for the stars
2. Review your financial situation.
It’s not what you earn, it’s what you keep
Here are 4 key words to remember when it comes to planning for your wealth