Author’s note: Life can feel incredibly expensive. This article is written by a financial planner, so there is some bias – I’m likely to recommend strategies that apply to women in general to manage financial risk.

However, it’s important to recognize that the ‘essentials’ I discuss may not be universally accessible or relevant to everyone’s financial situation as our financial journeys are diverse. It’s key to tailor financial advice to fit your own unique needs.

1. Your own bank account with three months’ emergency fund in it.

As a financial planner, I encourage my couple clients to share finances if they want to. In a healthy cohabitating relationship, working together might help you achieve your financial goals faster than doing so separately.

However, Canadian police reports suggest that women are 3.5x more likely to be victims of intimate partner violence than men. So, if they can, women should keep an amount equivalent to a three-month emergency fund at least in their own bank account. The rest of the family’s emergency funds could be kept in a joint account, or in the partner’s own individual bank account.

Single women should also have a healthy emergency fund in the bank, to help protect against the risk of job loss or unexpected expenses.

2. Enough insurance

One study tracked patients from 2002 to 2005 and found that women diagnosed with cancer or multiple sclerosis are 6x more likely to end up separated or divorced than if their male partners were diagnosed with the same illness. This article from 2021 quotes a 2015 study with similar findings.

Disability insurance is important for everyone, but that means it’s even more important for women – and you need to make sure it’s enough insurance that you can afford the cost of living on your own.

Critical illness insurance could also be essential for many women. If diagnosed with a critical illness, this lump-sum, tax-free infusion of cash could pay for care workers, or contractors to renovate your property to make it more accessible.

Life insurance can also ensure that your kids or parents are adequately provided for.

3. A financial planner

Women are super smart – we all know that.

We also know that money behaviours and beliefs begin at a very young age. These are modeled for us by our parents, and as women, we look to our mothers and grandmothers to teach us. Did you know that it wasn’t until 1964 that a woman could get a bank account in Canada without her husband’s permission?

We are the sum of all the generations before us. If it’s only been two generations that a woman could even get a bank account without permission, you can imagine how much personal finance instruction was missing from your education.

Because of that missing knowledge, women should hire a financial planner to help them reach their financial goals.

Does a financial planner feel financially out of reach? Consider free resources to learn about personal finance on your own! As you build your foundation, keep in mind that working with a financial planner down the line can greatly enhance your journey towards achieving your financial goals.

4. A financial plan

A financial plan encompasses #1 and #2 and is made with the help of #3.

Read more about financial planning here.

Women-specific issues that might be useful additions to a financial plan could be:

  • Factoring in caregiver drop-outs/drop-ins when estimating CPP entitlement.
  • Splitting of CPP credits when divorcing.
  • The exposure of inheritances to the risk of equalization upon divorce
  • Assisting couples in choosing equitable vs. equal division of household expenses.

5. A budget or cash flow plan that aligns spending with your values

“One woman spends $300 on makeup a month.

Another spends $300 on books.

Is one of these expenditures more worthy than the other?”

As the author of this article states, the answer is NO.

Women’s spending is often shamed. Whatever you value, and whatever brings you joy, deserves a place in your budget. Setting aside a dedicated amount of money for “luxuries” (whatever yours are) can make it easier to stick to a budget long term and reach your financial goals.

The irony is that shaming others for their spending can be counterproductive. Spending on extras can be “maladaptive” (hurting you instead of helping you) if it’s done to soothe negative emotions. Often, those experiencing shame turn to these maladaptive behaviours to feel better, blowing the budget and causing financial harm. This can become cyclical, causing harm repeatedly.

Set up a budget and be sure to dedicate money to the things that bring you joy, while also allowing you to reach your financial goals.

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