Six easy steps women can take to improve their financial outcomes

By Vanguard

The basics

Follow these empowering strategies to take bigger long-term financial strides.

International Women’s Day (IWD) is celebrated around the world on 8 March every year to highlight the social, economic, cultural, and political achievements of women.

At the same time, IWD draws attention to ongoing challenges faced by many women including financial inequality.

Various federal government data shows that Australian women typically earn less than men and have lower superannuation balances. There are also fewer female investors than men, according to the ASX Australian Investor Study 2023, and females that do invest often have more conservative investment strategies than men.

But there are a range of ways women can potentially improve their long-term financial outcomes.

We draw on a number of previously published Smart Investing articles to list six ways women can take steps to get financially ahead.

 

1. Understand the basics of investing

For anyone starting their investment journey, it’s important to understand your financial capabilities and to create clear and achievable long-term goals. Read five investing tips for beginner investors.

 

2. Consider seeking financial advice

Vanguard research has shown the people who engage with a financial adviser generally will take more purposeful action to prepare for retirement, particularly in debt management and budgeting, and are much more likely to be confident in funding their retirement. Read Most Australians are failing the retirement test.

 

3. The importance of budgeting

Putting some money aside in order to achieve financial goals must first involve knowing where money is being spent. That way it’s easy ways to potentially reduce expenses and increase savings. There are various types of budgeting strategies. Read about the envelope method; the pay-yourself-first method; the 50/30/20 method; and the zero-based budget method.

 

4. Starting the investing process

There’s a common misperception that in order to start investing, you need a large initial sum and lots of time. Here’s why this is a myth. Read how much money and time do you really need to start investing?

 

5. The power of making regular investments

A simple ongoing investment strategy can deliver substantial returns over the long term. Just by adding $100 per month, an initial investment of $5,000 into the broad Australian share market on 1 July 2014 would have compounded to more than $29,000 by 30 June 2024. Read How investing regularly can propel your returns.

 

6. Make extra contributions to your super

Even small additional contributions have the potential to boost your retirement savings, thanks to the low tax rates on super contributions, potential investment earnings, and compounding growth over the long term. Read It’s super hump month. Make the most of it.

 

Women face a range of financial challenges, however equally there are various steps can take to overcome obstacles and achieve long-term financial success.

Seeking out financial education and resources, building a strong support network, and working with trusted financial advisers can help women navigate the complexities of investing and build a secure financial future.

 

^{Important Information}

^{“This publication features the personal opinions and experiences of three retail clients of Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263). These views are presented for informational purposes only and do not constitute financial advice. Vanguard Investments Australia Ltd (ABN 72 072 881 086 / AFS Licence 227263) does not endorse or guarantee the accuracy of the opinions expressed in this publication. Readers are encouraged to conduct their own research and seek professional financial advice before making any investment decisions.”}