Some women are earning more than their partners and most are concerned about taking care of themselves financially after they’ve retired. With many of us expected to live to 90 it could be a long retirement, yet after the credit crunch we no longer have faith our pensions will be there when we need them.
Some women take full responsibility for supporting their families because they are single parents or their partner isn’t able to work.
Becoming a mother brings home just how responsible you are for your family’s finances, but most of the advice out there for mums seems to be around cutting spending. Living within your means is important but this is only one part of financial health. Why not live within your means AND increase your means at the same time?
There’s more to being a money-savvy mum than sticking to a budget and putting some savings away for a rainy day, although that’s an excellent place to start.
Instead, why not work on boosting your financial IQ? There are plenty of definitions of financial IQ, but it’s is basically just a clear understanding of how finances work.
Financial IQ is understanding of the flow of money – how it’s earned, how it is spent, and how it is invested. It’s the basics of making your money, protecting what you have made, budgeting, and making the best use of the surplus at the end. It is your income, what goes out and what’s left over.
To boost your financial IQ you could read the business section of the newspaper or websites, listen to financial podcasts and news reports or read books such as Rich Dad Poor Dad. Your first step may be to overcome your fear, or to simply get round to doing what needs to be done.
As Dale Carnegie, author of How To Win Friends And Influence People said, “Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy.”
Here are some ways you can take control of your finances:
- Business finances
Make sure your bookkeeping is done regularly and your tax return is submitted on time. You can use accounting software to do this but often Microsoft Excel will do the job perfectly well. You can find plenty of Excel training courses online. This way you can also make informed decisions about which product lines to expand or perhaps drop.
Also, think about your business model. Is your business scalable? In other words can you bring in other people to work for you or automate it so that you can sell it? If not, you may have created yourself a job rather than an asset.
- Protect the money you have
A good accountant should pay for themselves as he/she will be able to show you money that you’re entitled to keep or claim that you’d otherwise miss. Your accountant can also make sure your books are in order and protect you from paying any penalties to the tax people.
- Make more money
Try flexing your entrepreneurial muscles and look for unmet needs. Often we stick with what we know or are already doing, but the best way to succeed is to offer a product to a market that desperately wants what you have. Read The Millionaire Fastlane for more on how to create wealth as an entrepreneur.
- Accept you’ll have to think differently
You may have to challenge your own perceptions about money – that you’re not good enough at maths, that focusing on money is greedy, that a steady job is safer than starting a business. You may also have to challenge other people’s perceptions – friends and family may not understand your entrepreneurial projects or think you should go out and get a ‘proper job’.
- Live within your means, even when you get richer
There’s no point in making more money if you still spend all you earn and more. Aim to live on less money than you make, but at the same time aim to make a lot more money!
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