Today we celebrate Women’s day in South Africa. For this post I conscripted the help from the amazing women in my family. Ladies: do you know what is happening with your family finances?
Women live much longer than men. Any financial missteps taken in early life (on your behalf) could leave you destitute when you are least able to work. It is everyone’s responsibility to make sure that whoever is in charge of the family finances does not take too much risk in their retirement portfolios. Couple this with ensuring that you, as a family unit, save enough for retirement and you have a winning strategy.
The risk of financial ruin at the end of a relationship is usually disproportionately skewed towards the wife or main care-giving partner. Are you prepared if your relationship ends, either in the divorce court or in the coffin?
When approaching this exercise, make sure to go at it the right way. Your actions may be interpreted as a sign of mistrust. You don’t want to cause strife in your relationship by looking like you’re trying to find something! Make sure to approach it from a point-of-view of education and self-examination – just in case something bad were to happen…
Are you aware of all your accounts?
Sit down with your partner and pull both your own and your partner’s credit report and copies of recent tax returns. This will tell you about all credit accounts open, sources of income and deductions. You will also be able to ascertain the existence of investment accounts, retirement accounts and business accounts. If you do a budget, compare the income with expenses to check your cash flow if you were to land up in an emergency situation.
Do you know what happens if your partner dies?
Do you know where the will is? Are there emergency accounts that can be tapped for funeral expenses or living expenses for a couple of months? How can you access these accounts if your partner is no longer able to? Do you have life insurance and where is the paperwork? Have you spoken about a living will or medical power of attorney (to pull the plug or not?) Are you aware of the insurance you have and what it covers?
Gather all this information and store it somewhere securely, be it a safety deposit box at the bank or online with a service like Dropbox. If you have concerns after this exercise it may be a good idea to contact a Financial Planner who specializes in handling family finances.
The time for women to trust and hope that everything is OK with their family finances is over. Whether you are a homemaker,single or part of a dual-income family, it is the responsibility of both partners to take care of their finances. Empower yourself today and get involved!
Happy Women’s day, South Africa!