Many of us are spending more time at home because of COVID-19 these days. As we’re now in the summer holiday, many mothers are clearing out their apartments to make room for books and other items for the coming school year. While we need to do house clean-ups every now and then, the same goes to our personal finance – getting rid of out-of-date financial habits to make room for good ones.
In Hong Kong today, we have many females taking up important roles, enjoying career success and financial freedom. Yet in terms of money management, there’s still room for improvement for us all. According to a study by the IFEC, financial literacy among females is comparatively weak. Among the 1,000 participants in the study, only 14% of females believe their financial literacy is of a high level; that is 30% less than the male participants. Females are also found less likely to have financial goals – only 56% of women surveyed have set financial goals, compare to 64% of the male participants.
Typically Hong Kong females have longer life expectancy than males. According to the latest report from the Japan’s Ministry of Health, Labor and Welfare, Hong Kong women’s average lifespan is 88, while local men on average can expect to live to 82. In Hong Kong, the government’s Census and Statistics Department points out that female employees’ median monthly salary is $16,400, while male’s is $20,000. In other words, for females to plan for retirement, they need to be more proactive in saving and investing while having an income source.
To become more financially savvy, here are my tips:
1. Make the most of your time at home
As you may be spending more time at home during the pandemic, why not take the opportunity to look after your finances? Take advantage of personal finance resources such as the IFEC’s Money Tracker to keep tabs on your spending habits, cut off unnecessary spending and set a family budget. As females generally enjoy shopping, and can be emotional shoppers at times, it’s important to remind ourselves not to spend mindlessly, especially during the pandemic when we shift most of our shopping to online.
2. Self-Improvement
Most families in Hong Kong are duo income families. Yet with the deeply embedded traditional belief of females being the homemakers, most females end up being responsible for household chores. To have more time to train up your skills, learn about investment, pursue your interests to have a second (or even third) career, it’s worth talking to your partner about sharing the workload around the house so you will have time for your self-improvement projects.
3. Know thyself
As pointed out by American banker Tracie McMillion, you can become more confident in your investment decisions by research, planning, and finally auctioning upon. To become a smart investor, understand your preferences such as risk tolerance, investment horizon, and expected returns etc. Meanwhile, paying attention to financial and market news can help you analyse business operations and the macro economy, prompting you to make informed investment decisions.
4. Invest in your health
No doubt a balanced diet and regular exercises benefit your health, yet a suitable insurance plan can provide you and your family financial protection needed in the case of an expected event. Most insurance policies targeting women provide protection against the risk of some common critical illnesses, such as cancer and lupus erythematosus. The types of illnesses covered vary among insurance companies, so before committing yourself to a policy, do thoroughly study and compare the coverage and terms of different schemes, and choose the one that best suit you.
