Are you in a relationship where you regularly discuss finances or your financial goals? Or are you left out of household financial decisions? Would you consider yourself to be financially independent?
Financial relationships and decision-making can be difficult to navigate, but it’s important to recognise your financial wellbeing is a crucial part of your overall wellbeing – and this is true in the context of shared finances also.
Feeling in control of your finances doesn’t have to be a difficult or overly time-consuming task. Here are some simple steps that might help you with your financial wellbeing.
1. Know where your finances are, and how to access them
It may sound simple, but it’s important that you know where your finances are located, as well as how to access funds independently. For instance, having your own bank account and PIN number is a great way to ensure a degree of independence.
It’s also important for you understand what you and your partner’s shared cash flow looks like – for example, what automatic payments are being direct debited from your bank account(s)? Are bills such as utilities being paid on time? Where is your shared income coming from (salary, property investments, shares etc.) and how is it being spent? Remember, it is OK to question and renegotiate how finances are dealt with and bills are paid.
Another important conversation is around debt. What level of debt are you and your partner comfortable with? And are you both fully aware of any existing personal or shared debt? If you’re not sure how to start that conversation with your significant other, take a look at Women Talk Money, a resource created by WIRE Women’s Information which includes some helpful tips on this.
2. Personal superannuation: find it
A 2017 report by the Australian Services Union and Per Capita found that Women in Australia retire with less than half the amount of savings in their superannuation accounts compared with men, yet ABS data1 shows that a woman’s average life expectancy is 84 years, compared to 80 years for men.
Research by NATSEM has also shown that the financial implications of relationship breakdowns tend to be heavier for women than they are for men. It follows that it’s vital that women manage their personal superannuation carefully, in order to secure their financial futures.
If you’re being paid a salary and you haven’t already done so, determine where your superannuation is located. Is it being paid into more than one fund? How much are you contributing annually? What sorts of fees and charges are you paying? Does your fund provide other benefits, such as insurance?
Taking time off paid work (for example, to have a baby or care for someone) may also affect your super. ASIC MoneySmart has been designed to help you gain a better understanding of your superannuation, and also includes information and advice specifically for women. To find out more about Australia’s superannuation system, visit the ATO.
Another tool that can help you estimate how much money you may have when you retire, in just a few easy steps, is CommBank’s retirement calculator. It also provides some suggestions for how you could grow your retirement income. Please note, CommBank can’t predict the future, so all the calculations are based on the information you’ve provided, and some assumptions that CommBank has made.
3. Have some money set aside for the unexpected
Having some money set aside for unexpected costs could save you a great deal of stress, anxiety and financial hardship.
This could mean diverting a portion of your regular income, and not touching those funds unless the ‘unexpected’ truly happens – think extensive dental work or car repairs.
Whether it’s for a ‘go fund’ or unexpected household expenses, the idea is to scrimp just a little in the short term in order to cover those unpredicted costs in the longer-term.
Struggling to budget effectively? The CommBank Budget Planning Calculator is a useful tool for helping you stay on track with your spending, as well as plan your saving for the unexpected.
1 3302.0.55.001 - Life Tables, States, Territories and Australia, 2014-2016.