Product Head for FNB, Ester Ochse argues that women might just be better at managing their money than their male counterparts.
Her reasoning behind this is simple: Out of the four areas of money management listed by the bank – budgeting, credit, savings and protecting one’s family – women have earned top mark in at least three of those areas.
“Having a budget helps with keeping track of spending and allocating money to needs in the household.
“We have seen that when one proactively engages with smart budget on the FNB App, more money is spent on savings, investments and insurance. Interestingly, women engage less with FNB Smart Budget than men, which may have an impact on their longer-term financial wellness,” Ochse said.
Having a budget, either written or digitally using FNB Smart Budget, there is a likelihood that cash could be freed-up to help with short- and long-term goals.
Using the right credit at the right time for the right reason can be a very powerful tool. But, using credit to sustain a lifestyle or living beyond your means can impede long term wealth creation or potentially start a downward spiral of debt.
“While the difference between men and women is not significant, we see over the last year, men have been taking up more unsecured credit than women. The idea is to reduce unsecured credit to a manageable level with the freed up cashflow from the budgeting exercise and then applying the principle to reducing secured debt,” she said.
When it comes to savings, FNB said that women are slightly better at it than men.
“Women consistently have more savings on hand than men do, be it 1 week, 1 month or 3 months.
“Specifically looking at 1 months’ worth of savings, approximately 2% more women have 1 months’ worth of saving compared to men. The ideal aim is to have 3 months’ worth of income available in a fund that can be easily accessed, specifically for unforeseen expenses such as a medical bill or a burst geyser,” Ochse said.
It may seem like a lot and potentially unachievable, but start small and set small goals to build up an emergency saving.
To protect loved ones, there are a few things that should be considered like life or funeral cover and having a Will in place.
Life cover is specifically aimed at ensuring that financial dependants can maintain their lifestyle if something should happen to the breadwinner.
Funeral cover is aimed at providing for the immediate expenses after the death of a loved one. Ochse confirmed that more women tend to take up life and funeral cover as opposed to men.
“The question always is, is the cover enough? That is where you will need to get advice to guide you in the right amount of cover required for your specific circumstances,” she said.
Ochse also advised that having a Will in place is another important consideration when it comes to protecting a family. A Will ensures that minor children are looked after, and their financial interests are looked after.
“In a Will, you can ensure that the people you want to inherit your estate, will inherit it. Men and women are very similar with only 1% more women setting up a Will,” she said.