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Money tips to empower women

Money tips to empower women

Research shows that women do not get really serious about managing money until they hit a crisis – until they lose a job, lose a partner or are on the brink of retirement.

But becoming smart about money and planning for the future should be a priority, says the ACCC’s Delia Rickard.

“Women are great with doing the family budget and making money stretch to meet their kids’ needs, etcetera. But they’re not good at thinking about their long-term financial security,” she said.

“But the reality is we get paid less than men on the whole, and even though we’re in and out of the workforce much more than men, we live longer than men so it’s really important that we start to think early on about saving for our retirement and doing some of that long-term planning which all too many of us tend to leave to our partners.”

So what are her top money tips for women?

Get yourself a budget

The starting point, no matter what the issue you have with money, she says, is to do yourself a budget and understand what’s going in and where it’s going when it goes out.

Then give yourself a financial health check. Use a financial comparison website such as RateCity to ensure you’re getting the most suitable deal for everything money related from your home loan and credit card rates to car insurance, health insurance and life insurance.

Switching to the most suitable products may not only free up money – potentially thousands of dollars – but can also give you the peace of mind to know that you’re covered, should something go wrong.  

Have an emergency fund

“Then look, have you covered your basics; have you got some money set aside for an emergency? Have you got the insurances in place that you need?” she said.

Set up a savings account – RateCity monitors savings rates from a range of institutions with rates as high as 4.65 percent. Or if you have a home loan then consider an offset account as a place to park your emergency fund.

Contribute to super while you’re young

Women should also be making extra contributions to their superannuation, where possible.

“Chiefly because women have those periods out of the workforce, the more you can put in when you’re young, the more that magic of compound interest works in your favour,” she said. “And depending on what you’re earning you could also be entitled to the government’s co-contribution, which is money for nothing so you’d be mad not to be grabbing it!”

Beware of ‘Sexually Transmitted Debt’

Many women agree to go guarantor for a partner or their children, without doing their homework, she says.

“The decision to do that is an emotional decision based upon the relationship,” she said. “Women need to understand that they will be liable for the debt if the other person doesn’t pay it and it’s always good to get yourself some independent advice.”

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How to make money with a savings account?

Savings accounts make you money by earning interest on your savings. The more money you deposit, the longer you leave it in the account, and the higher the account’s interest rate, the more interest you’ll be paid by the bank or financial institution, and the more your wealth will grow.

To make sure your savings account makes money and doesn’t lose money, it’s important to maintain a large enough minimum balance that the annual interest earned exceeds any annual fees charged on the account.

How much money should I have in my savings account?

A good rule of thumb when working out a minimum balance for your savings account is to make sure that you’ll earn more in annual interest on your savings than what you’ll be charged in annual fees.

If you’re saving with a specific goal in mind, prepare a budget so the interest you earn on your deposits will help you efficiently reach this goal. Online financial calculators may be helpful here.

What is a savings account?

A savings account is a type of bank account in which you earn interest on the money you deposit. This makes it one of the easiest and safest investment tools.

Should I open a Commonwealth locked savings account?

If you have trouble saving money, a Commbank locked savings account could be a potential solution. A locked savings account won’t let you make withdrawals and as such, it can help you grow your savings balance if you keep topping it up. 

The Commonwealth locked savings account advertises high-interest rates and minimal maintenance fees, along with a host of other incentives that will encourage you not to touch the money. 

The account offers a higher interest rate for each month that you make limited or no withdrawals, as well as regular deposits. 

To qualify for a Commonwealth locked savings account with the advertised features, you will need to fulfil specific criteria such as:

  • Depositing a fixed minimum amount into the account every month.
  • Making a fixed number of deposits each month.
  • Making a minimum or no withdrawals each month.
  • Maintaining a minimum account balance.