3 financial steps to help women “live on their terms”: advisors
When it comes to managing money, women face special challenges.
According to Kamila Elliott, certified financial planner and co-founder and CEO of , women tend to live longer than men, which means their money needs to last longer Collective Wealth Partners in Atlanta.
Many women also tend to take time off from work to look after children, parents or significant others, noted Elliott, a member of the CNBC Financial Advisor Council. Prolonged absence from the labor market could impact women’s financial security and retirement, she said.
Working with a financial advisor can help women navigate these difficult times.
“I think it’s important for women to feel empowered, and part of that feeling is empowered to have the financial resources and financial stability,” Elliott said.
Elliott, who became the first black person to chair the CFP Board of Standards, said the industry is working to educate women from an early age “how much fun finance, budgeting and investing can be.”
Still, women of all ages can thrive financially by pursuing a variety of strategies, Elliott said.
1. Negotiate your salary
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Research has shown that there is still one There is a gender pay gap that results in women earning less. That could impact how well women can invest in retirement and other goals, Elliott noted.
Women can help bridge these gaps by negotiating their salary. especially when stepping into a new role, Elliott suggested.
She pointed out that some locations may have new pay transparency rules that could benefit women by eliminating the need to disclose current salaries and showing the pay ranges the jobs could offer.
2. Make investments a priority
According to Elliott, women may be reluctant to invest their money for a number of reasons. They may find investing too complicated or don’t have the funds to invest.
But when women invest, they actually tend to outperform men, she said. A Fidelity Investments’ 2021 study found that female returns tend to outperform males by 40 basis points, or 0.4%. This is based on an analysis of the annual performance of 5.2 million accounts.
It is important for women to feel empowered, and that includes having the financial resources and financial stability.
CEO of Collective Wealth Partners
Today’s market volatility could be an opportunity, especially for those retiring in 10 to 30 years, as they have time to weather these ups and downs, she said.
If average market yields recover, it can lead to significant advances over time, Elliott noted.
3. Set up a Financial Freedom Account
To feel empowered, women need financial resources and financial stability. That means having an emergency fund is “vital,” Elliott said, since there’s three to six months of your monthly operating expenses in a liquid savings account.
In addition, Elliott works with clients to create a “Financial Freedom Account,” which can help create a financial cushion to make changes when they feel they are in a relationship, job, or life situation to get stuck
“It gives them the freedom to live their life, do what they want, and empower them to make the right decisions for themselves and their families,” Elliott said.
https://www.cnbc.com/2023/05/22/3-financial-steps-to-help-women-live-on-their-terms-advisor.html 3 financial steps to help women “live on their terms”: advisors