smart women

4 Smart Money Management Strategies for Women

As women, each of us is as different and varied as snowflakes. That’s part of what makes us beautiful and unique.

But whether you’re young or older, married or single, raising kids or have no children, we all share one common desire: to have a financially secure future.

In generations past, our mothers and grandmothers may have worked, stayed at home, or did a combination of both. In many cases, the men in their lives ran the family’s finances.

But these days, a record 95% of women in America are financial decision-makers in their homes (either solely or jointly with spouses).

If you’re a woman looking to improve her economic situation, rest assured that you can master your money and get ahead financially. Here are key strategies to help you do just that.


Much of your financial well-being depends on a creating a financial plan to succeed – as opposed to merely “hoping for the best” or thinking “I’ll worry about my finances down the road.”

To create a winning financial plan, you must consider what personal, professional and financial goals you’d like to achieve, and then put a price tag as well as a deadline on those goals.

Here are some common goals that many women share:

  • Paying off excessive debt
  • Earning a B.A. or graduate degree
  • Buying your first (or second) home
  • Sending your kids to college
  • Starting a business
  • Planning for retirement

All of these goals cost money. Each also requires an investment of your time and energy.

Start by thinking about what is truly important to you, then write down your own goals. Place them somewhere visible – like on your bathroom mirror or on top of your dresser to serve as a constant reminder and to reinforce your motivation.

When you draw up your list, don’t state vague, hazy goals such as “I want to be rich” or “I want a comfortable retirement.” Instead, create “SMART” goals. SMART is an acronym that stands for goals that are Specific, Measurable, Action-Oriented, Realistic and Time-bound.


Finding good financial help will go a long way toward helping you reach whatever goals you establish.

In fact, women who use a financial professional are more than twice as likely as those who do not to consider themselves on track or ahead of schedule in planning for retirement, according to a 2014-2015 study on women and money from Prudential Financial.

Financial help can range from an accountant who shows you how to minimize taxes to an investment expert who guides you through the intricacies of investing in stocks or bonds.

Selecting an investment professional will require some effort, but nothing extraordinary. You just have to be willing to ask good questions, trust your instincts, and do a bit of homework.

  • Get Referrals from Those You Trust

Begin by asking relatives and friends for the names of professional advisers they’ve worked with and would feel comfortable recommending.

Your goal is to find someone experienced who can help you reach the next level financially. It should be a person whose client base is somewhat similar to you.

For example, if you’re making a modest salary and have a job in Corporate America, you don’t want to hire someone whose clients are primarily millionaire entrepreneurs.

  • Do In-Person Interviews

Take the time to interview at least three individuals in person. Inquire about each person’s career experience, educational background, and investment philosophy.

Don’t be afraid to bring up the issue of compensation either. A trustworthy adviser will answer your questions honestly without side-stepping the issue.

You need to know whether he or she will be paid a commission, a flat fee, or an hourly rate. You can find a fee-only financial planner at http://NAPFA.org, the National Association of Personal Financial Advisors.

Also, ask whether an adviser can provide you with a list of satisfied clients you can contact.

  • Conduct a Background Check

Your final step in the selection process is to check out each individual through federal authorities and state regulators.

A good place to start is with the Financial Industry Regulatory Authority, also known as FINRA.

FINRA has a database called the Central Registration Depository, or CRD. It contains information about all licensed brokers, such as where they’ve worked for the past 10 years, whether the person’s license or registration is up-to-date, and whether the individual has been subjected to regulatory sanctions for financial misdeeds.

You can reach FINRA at 800-289-9999 or at http://www.finra.org.

FINRA’s records, however, don’t always report everything pertinent about stockbrokers. So be sure to also contact your state securities regulator – via the North American Securities Administrators Association, or NASAA – for any information they may have at http://nasaa.org.

For instance, advisers are required to fill out a document called Form ADV. It contains two parts, including information about a broker’s services, fees and strategies. Ask any adviser you interview for Part 1 and Part 2 of his or her ADV form.

And if you’re worried that “checking up” on a broker might offend the person, put your worries to rest. You are legally entitled to this information.

Plus, brokers and advisers aren’t told that someone has requested a CRD report about them when you get info through FINRA or when you look up an adviser in the SEC Investment Adviser Public Disclosure Database, http://adviserinfo.sec.gov.


Many of us think our economic problems would be solved if only we had a bigger salary.

The truth is that whether you earn $30,000 a year or have a six-figure salary, you can improve your personal finances with some savvy money-management moves on the job.

A few ideas:

  • Max Out Your 401(k) or 403(b)

According to the U.S. Department of Labor, less than half of all working women participate in company-sponsored retirement plans. Some women choose not to contribute because they have a husband or partner who works.

But even if you’re married, it’s important to have your own retirement assets. That money would come in handy in the event of divorce or the unexpected death of a spouse.

Besides, by not contributing to a 401(k) or 403(b) plan, you lose considerable retirement assets.

Not only do you get a tax break for participating in a 401(k) plan, but many companies also offer a matching contribution, usually 50 cents for every dollar you contribute, typically up to 6% of your salary.

Under federal guidelines, the 2016 maximum contribution amount you can make to a 401(k) plan, including your employer’s contribution, is $18,000. (For those 50 and older, you can make an extra $6,000 contribution, for a total contribution limit of $24,000).

  • Don’t Be Afraid to Negotiate

In 2015, some employers clamped down on handing out all types of raises, including merit-based increases and cost-of-living adjustments. Nonetheless, the average pay raise doled out in 2015 still hit 2.8%.

And it’s expected to go slightly higher, to 2.9% in 2016, according to Mercer’s 2016-2016 U.S. Compensation Planning Survey. Even better news: salary increases for top-performing employees – about 7% of the workforce – will be almost twice that of average performers, Mercer found.

Consequently, you shouldn’t be shy about asking for a raise.

Women already earn, on average, just 75 cents for every dollar that men make. And since many women tend to be out of the workforce – at least temporarily – during their childbearing years or to care for aging parents, it’s especially important to make the money you earn on the job count.

Yet, many women dread the prospect of boosting their income by asking for a raise.

If you’ve earned it, however, a request for a merit-based pay increase is perfectly reasonable.

Get the raise you want by documenting your past successes, creating a detailed list of specific accomplishments, and demonstrating to your manager that you have the capacity and the desire to take on increasing levels of responsibility within your company.

  • Take Advantage of Cafeteria Plans

Cafeteria Plans – sometimes referred to as 125 Plans because they’re based on Section 125 of the IRS tax code – allow you to use pre-tax dollars to pay a variety of out-of-pocket expenses.

As a result, your company’s cafeteria plan may help you save money on medical costs, dental and vision bills, health screenings, hearing checkups, well-baby care, along with life and disability insurance.

To find out what benefits are offered by your employer’s Cafeteria Plan – also known as a Flexible Spending Account or FSA – check with your human resources office.

Just be aware that these are “use it or lose it” plans that require you to spend money put in the plan by year-end. If you don’t, the money is gone.

Also, FSA funds can’t be used for over-the-counter medicines, unless you have a prescription from a doctor. Under IRS guidelines, FSA contributions for 2016 are limited to $2,550.


The relationships we have with various people in our lives can serve to bolster our finances, or deteriorate them if we’re not careful.

As women, we must first learn to have a healthy relationship with money by ourselves, learning how to manage money properly, avoiding excessive debt, and by shattering the myth that money issues are either “too complicated” or “too boring” for us to handle.

Once we start to properly handle our own financial affairs, then we can extend that healthy perspective about finances to how we deal with money when it comes to friends, family and loved ones.

Be Selfish – For the Greater Good

It may sound like an oxymoron, but being “selfish” about your personal finances actually can help you enhance the lives of others.

How so? When you are financially secure, you’re less stressed, so you can be more patient with the kids, more generous in your economic giving to religious groups or charity, and more productive at work.

On the contrary money problems can dampen all these things. To strengthen your financial standing, try implementing the following tips.

  • Establish a Personal Cash Cushion

Set aside at least three months worth of all living expenses to protect yourself and your family in the event of an emergency or some major unexpected expense. Fortunately, having survived the Great Recession, more of us are starting to save—but not nearly enough.

Women still save less, on average, than men. And the Employee Benefit Research Institute says about 60% of American workers age 55 and older have less than $100,000 saved for retirement, including 21% who have socked away less than $1,000.

  • Avoid Over-Spending On Others

Many of us are guilty over indulging our children and other family members with luxuries ranging from expensive clothing to electronic gadgets to a house full of toys.

Build Your Own Credit Rating
Over-spending sets you back financially and sends the wrong money messages to those you love.

It’s not enough to have joint credit accounts with a spouse. All women need to have credit in their own name, in order to establish a solid credit history and to learn how to manage credit wisely.

For years, federal law has entitled us to a free copy of our credit reports via the government-mandated website http://www.annualcreditreport.com.

Now, thanks to the Wall Street Reform and the Consumer Protection Act, you’re also entitled to a copy of your credit score if you get turned down for credit, denied a job, or suffer any adverse decision (such as getting higher insurance rates) on the basis of your credit.

  • Maintain a Separate Account

Many couples share joint accounts to pay household bills – and that’s fine. But having a separate savings or checking account gives you a heightened degree of financial autonomy and helps you become better at saving and budgeting too.

By adopting these strategies, women of all ages, incomes and backgrounds can create an outstanding, stress-free financial future.

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