3 Money Rules for Women
1.Sort out your super
Employers are legally obliged to pay a sum equal to five per cent of your gross income - rising to nine per cent by the year 2000 - into a superannuation fund. But while this is a move in the right direction, it is nowhere near enough to support you in your retirement. Financial advisors warn that even if you start saving for your retirement when you are 30, you’ll need to put 17 per cent of your gross salary every month into a superannuation fund in order to provide a retirement income equal to two-thirds of your final salary. If you put off saving for your retirement until you are 40 the figures are even more daunting - to maintain an income equal to two-thirds of your salary you need to save 27 per cent of your salary each month. All of which means the earlier you start saving the less painful it will be.
*Don’t worry about leaving your superannuation savings behind when you change jobs. You can set up your own personal scheme into which you can transfer any superannuation you have accumulated in different jobs.
2.Start a regular savings plan
While superannuation is an important piece of the financial jigsaw, it is not the whole story and you should also start a regular savings plan - and soon. It’s a sobering thought, but if you’re a single, employed woman in your twenties or thirties, you’ve probably got more disposable income than you’ll ever have again, and ahead lies the cost of buying a car, a house and having children.
While a bank account is fine for short-term savings, if you want to save for the future, say over a five or 10 year period, invest in something which gives capital growth and this is through a managed fund - a unit or investment trust - which allows you to spread your savings over a range of investments including shares, bonds and property.
*If you start saving $200 a month, in 10 years time, assuming an investment return of eight per cent, you could accumulate over $45,000.
3.Make a will
Perhaps the best reason for writing a will is the trouble, worry and expense it will save your family and friends when you are gone. Even if you are single, making a will means that you choose who to leave your possessions to. The government’s rigid formula for dividing up a person’s estate takes no account of friends or favourite charities. And if you have a partner and/or children, it is vital that you write a will.
You can make a will yourself - printed will forms are available from stationers - however it is a good idea to get help from a solicitor when drawing one up to ensure you use the correct legal wording. Alternatively a Public Trustee (their number is in the phone book) will draw one up for you free of charge provided that you appoint them as your executor.
* You can change a will as often as you wish as your circumstances change.
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