Women and Money..
1. Not establishing a real budget for the month
“The biggest challenge for budgeting is tracking the daily expenses. Keeping track of your car payments,your rent, your utilities and your cell phone is not necessarily difficult,”says Montanaro, a certified financial planner at USAA. But if you really want to fine-tune your finances, basic expenses are just the beginning. Take a look at your lifestyle. If you’re a party-girl, save some pocket change for your pomegranate martinis. But don’t be too much of a stickler because the unexpected moments are the most exciting part. Plan just enough to avoid end of the month mishaps.
2. Not saving
‘Starting with a low level of saving, like 3 or 4 percent of your income and then as you get raises throughout your career, you can increase the level of savings,” says Luke Delorme, Research Fellow at the American Institute for Economic Research. Even if you don’t earn a lot of money, put away your pennies for in-case-of-emergency. You’ll be happy you have it if your car breaks down. Even if economizing seems to be soporific, it is crucial for your future. The best way to succeed in saving is to save at the beginning of the month. As soon as you receive your income, save a percentage and don’t begin the month without saving. You know already how much you can spend. Your savings don’t depend on your expenses, but your expenses depend on your savings.
3. Thinking that credit cards represent free money
You don’t realize how much you spend during only one day of shopping when you use your credit card. It seems to be like an unlimited source of money. But we have to be careful about it and check our bank accounts often. Make it a habit. Write down your password to your online banking and keep it on you, in a safe place.That way you no longer have an excuse and can keep track of your expenses.
4. Not knowing how you spend your money each month
At the end of the month,your account is at zero and you have absolutely no idea how you could have spent all that money. You’re human, don’t worry. Money goes really fast. Use your online banking to check your percentages, how much you spent on food or shopping, for example. Doing so will help you spend less the next month and even less the month after. With this exercise, you will begin to manage your money.
5. Forgetting to pay your bills
When you open your mail and cringe at your bills, don t put them away. Don’t think, ‘I will pay it later, tomorrow, or another day’. Just do it that moment. Because otherwise,you will forget to pay. The longer you postpone it, the more you’ll end up paying in interest.
6. Not having an emergency fund
65% of Americans do not have sufficient emergency savings, according to a Bankrate survey. In case of a medical emergency or a loss of your job, you should always have an emergency (2-3 months of wages for expenses). Emergency funds could help you stay debt-free during a financial crisis.
7. Putting off saving for retirement
Retirement still seems incredibly far away. The fact is that a retirement savings is more effective if you start saving when you are young. The earlier you start saving, the more years compound interest can work in your favor. Ask a Baby boomer, retirement comes faster than you think, and at that moment, you will be proud of yourself if you saved more than pennies.
8. Forgetting Insurance
You have to take out a lot of different kinds of insurance, such as health, life, home and disability.However, you forget to do it because it’s not a fun subject to chat about or to manage. But, it is necessary to live in peace, exempt from worry. Take the time to choose the best insurance plan, that fits your lifestyle. Having insurance will make you feel secure, above everything, if something bad happens.
9. Underestimating taxes
Do you wait until April to check exactly how much you have to pay in taxes? Be mindful of what tax bracket you fall under each year and what exemptions you qualify for. Take time to do the proper calculation of your taxes or hire a professional.
10. Overspending on too many clothes
With all the different shops, it’s easy to spend your extra money on clothes, even clothes that are similar to the ones you already own. Just try to stay focused on what you need. “You can have fashion sense and financial sense” says Ungenita Prevost and not overspend.
11. Doing emotional investing
Before investing in a business, you have to do your due-diligence. Investing is serious and it can bring you huge returns, but it also comes with risks. That’s why you have to be aware and understand all the financial components of each investment. The emotional part can over complicate the situation, so stay calm to avoid making half-hazard decisions.
12. Overspending because it is your first job
Of course, you can enjoy your new income because it is an exciting feeling. However, be careful. Just because you earn more does not mean you can buy everything you want. You have to balance between your desires and what you can buy in reality without getting into debt.
13. Overspending on gifts
You are not required to spend a ton of money on gifts. You can find great deals and discounts without breaking the bank. Even sometimes a homemade present is more appreciated because you took the time to create it. It is a gift from the heart.
14. Incorrectly calculating the ‘percentage off’ of sale items
During a sale, there area bunch of bright, inviting, red signs stating an array of reductions.You grab a handful of items, try them all on, then while waiting in the checkout line, you realize you don’t even know how much you are about to pay.Finally, you reach the cashier and ‘surprise’! Keep a calculator on you during sales and use it every time, just to be sure! The one on your phone will do just fine.
15. Not talking about money before marriage
It is a necessary conversation to have because it is going to define your financial future. You have to decide if you are going to keep separate bank accounts or if you are going to combine them according to your income and lifestyle. You also need to be aware of the financial situation of the your significant other. For example, if he’s in debt or not. “Sexually transmitted debt is on the rise” says Ungenita Prevost, don’t shy away from the money conversation with your partner.
16. Leaving the finances to your man
“The dumbest thing I see women do with money is convincing themselves that they aren’t good with it,”says Ellen Rogin, president of Strategic Financial Designs Inc. It’s time to stop resting on your laurels with the I’m a woman and I prefer my boyfriend/husband handle the finances. It is not because you are a woman that you can’t make good financial decisions for you or your family. Make a new commitment to understand money and getting your financial house in order. In case of a separation, break up or divorce,you want to be in control of your financial future. Be an independent woman!
17. Not looking at the exchange rate when you travel abroad
Exchanges rates differ widely from country to country. You have to check current rates before leaving on a trip abroad and modify your expenses accordingly. For example, in France with one dollar you have 0.9 euros. But if you go to China, with one dollar, you have 6.2 Yuan.
Do the math and you will have more money in your account!