Power of The Purse
The MoneyShe Way...
Women around the world are waking up to the power of the purse as they increase their independence and freedom through finances. Female investors now control roughly a third of total assets under management valued at €4.6 trillion. By 2030, it’s predicted that this figure will reach a whopping 45%!
Women are also increasingly taking control of their household finances, especially as many are joint breadwinners and more money-savvy. But there is much more to do as the gender pension gap is still 38%, leading to pension poverty in later life.
One of the most common misconceptions is that putting cash away for a rainy day or to fulfil your future aspirations is a smart saving option. But we forget that in terms of real returns (after inflation and costs), cash is not enough and should be a cushion - not your complete future financial plan!
Read on for some all important tips from MoneyShe to become more financially savvy today and still save for the future whilst the costs of living are rocketing.
Coping with the Cost-of-Living Crisis
Households all over the nation are concerned about lack of leadership, lack of details around government support packages, high inflation, high interest rates, mortgage payments/rents, higher shopping bills and energy bills; not to mention Christmas. The all-encompassing cost-of-living crisis. Oftentimes, people dealing with debt or money worries suffer mental health issues by extension.
It’s hard not to feel overwhelmed by the repetitive news headlines on inflation and markets. With inflation expected to ‘peak at 11% in October’ [1] and wages increase failing to match the rate of inflation, many are worried their money will fail to pay for what it used to. From bills to groceries – things are getting noticeably more expensive. But during times of economic uncertainty, it’s vital to try to stay calm and ‘focus on what you can control’ [1].
MoneyShe understands that it can be easy to ignore money matters, to become overwhelmed and tempted to bury your head in the sand – hoping problems will go away. Educating yourself, building confidence by increasing financial knowledge is not just empowering but a great feeling!
Investing
InvestingPutting all your savings into investments can be a risky move as the warning goes – your capital is at risk – and yes, markets can go up as well as down so you could get back less than your initial amount invested (especially if you’re with a wealth manager that charges high fees!). But over the medium to long term, investing is the best way to beat inflation and receive real returns.
Budget
To figure out your budget, you need to consider your monthly salary (income) and your monthly (outgoings). That can be understood by printing out your last 3 month’s bank statements and highlighting all the necessary and unnecessary costs. For example, paying rent is a necessary cost, so you need to budget effectively to have enough money to pay that out of your salary. It’s best to pay any large costs (e.g. rent and bills) as soon as you get paid so you’re aware of how much you have left over for the rest of the month as soon as possible. That, in turn, helps you budget for the smaller necessary costs e.g. groceries, petrol, smaller bills/subscriptions. If you have money left over after budgeting for all of those things, you can consider putting some aside into either a high-interest savings account or Cash ISA, or if you’re feeling adventurous you could put it into a Stocks & Shares ISA based on your risk appetite.
It’s important to seek financial advice if you’re unsure about any financial product – but be sure to ask them the key questions to avoid your investment pie having chunks taken out of it!
Increasing your income
Increasing your incomeEmployers all over the UK have been increasing wages to try to help with the cost-of-living crisis but with inflation rising at such a rate, not all salary increases have matched to compete or surpass the inflation rate. This has left many people looking for alternative streams of income. For those who have surplus cash, investing can be an excellent passive income stream but for those who don’t have anything to invest – there are some methods of making extra money.
Here are some ideas for a side hustle:
- Selling old/unwanted items on Depop, Ebay, Vinted or Amazon
- Taking part in paid online surveys and reviews
- Becoming a freelance blogger paid to write articles
- Becoming an online tutor if you’re particularly skilled/qualified in a subject
Reducing your spending
If you don’t have the time to start a small side hustle, the other effective way of having more money left in your monthly budget is to take a look at your unnecessary expenditure over the last few months and see what you can remove. That could include the following:
- Unused subscriptions to Netflix, Amazon, Spotify, Gym, Pret etc.
- Use cheaper public transport over car
- Swap expensive branded food items for cheaper ones
- Cook more and get less takeaways/eat out less
- Treat yourself to a nice item less often
- Turn off lights, plugs on standby and taps when not in active use
- Make use of vouchers, coupons, and loyalty cards where possible
Your future financial health the MoneyShe way...
MoneyShe believes education and knowledge are the best stepping-stones to understanding, empowerment and confidence. They offer a range of FREE engaging brochures, blogs, questionnaires, and third-party resources to help you make sense of investing, pensions, tax, inflation – your future self is worth it!
Whilst they do not believe women and men need different investment products, they do believe that the language, communication, and client relationship need to be tailored according to different audiences. The traditional ‘masculine’ boys with toys adverts and brochures and sales teams put most women off.
MoneyShe’s tone of voice and style makes finance and investing accessible to women of all ages and backgrounds. They encourage open conversation about money, invite guest bloggers to provide their expertise and for women to share their money matters and experiences on our sisterhood Noticeboard - conversation about money going! A problem shared is often a problem halved.
Once you feel ready to start your investment journey, their sister-brand, SCM Direct is a modern efficient, low-cost, 100% transparent online wealth manager offering a range of highly diversified, actively managed Portfolios – including an ESG Portfolio for those looking for good returns whilst doing good.
Sources:
[1] https://www.stylist.co.uk/money/what-is-a-recession/711654
[2] https://www.stepchange.org/how-we-help/rising-cost-of-living.aspx
[3] https://www.glamourmagazine.co.uk/article/money-saving-tips
Capital at Risk.
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the past performance is not a guide to future returns.
MoneyShe is a trading brand of SCM Private LLP which is authorised and regulated by the Financial Conduct Authority to conduct investment business No. 497525. Registered in England and Wales No. OC342778.
