ONLY a quarter of Australians have a strategy for achieving their financial goals, and women tend to face additional challenges in this area, financial experts warn.
MOST of us are optimistic about our financial future, but only a quarter of Australians have a strategy to achieve their goals.
Indeed, most people, when asked the question, don’t even know what their goals are – and this is your first step, says Louise Lakomy, Chartered Financial Planner and Director of Crystal Wealth Partners.
“Before you put in place a strategy (you have to) identify what you want at the end of this trip,” says Lakomy.
“Most people don’t really know what it is right away; you have to think about it. “
Many of us will have vague ideas about what we want to achieve, such as own our own house, but I didn’t think of how to get there.
A recent survey by the Financial Planning Association of Australia found that two in five people had made a vague financial plan.
And 75% of us haven’t made any plans or very vague plans on how to achieve common aspirations such as financial independence, retirement security and travel plans.
This despite the fact that there are more tools and information available than ever before.
“It’s really important to know what you’re spending and to simplify (your finances),” says Eliane Miles, research director at research and strategy firm McCrindle.
She says there are so many great budgeting apps available that can track your spending for you. Otherwise, some people simply divide their income into three compartments for bills, savings, and one for discretionary spending.
Women are generally worse than men when it comes to facing their financial future.
Only a third of women aged 20 to 51 have made a financial plan, compared to 46% of men.
“Women tend to trust someone and 17% say they let their partner make most of the financial decisions, compared to just 12% of men,” says Miles.
Lakomy agrees that women are more likely to delay financial goal setting, but get better.
She says women are more likely to lack self-confidence when it comes to money, even though they are earning more than ever.
“Women often feel a lack of self-esteem or fear that they don’t have enough money to justify setting financial goals when a man doesn’t have those doubts,” she says.
However, managing money and setting goals is relevant to everyone, no matter how much they earn, she adds.