Smart Money Ideas For Women At Every Age, Eh!

Every woman is unique. We each have our own talents and gifts that make us stand out. It makes sense that our financial situations are also special. Often there are patterns to managing money that change as we age. So, we’ve compiled this list of smart money ideas for women at every age.

Here you’ll find the best money moves and investment ideas for women, sorted by decade.

It’s okay if your current money situation doesn’t fit neatly into one of the age-groups below. Life moves along at a different pace for all of us, and there can be set-backs.

Perhaps you spent your 20’s traveling and started your career late. Maybe you took a decade off to raise your kids at home, and are just getting back into the workforce.

Whatever your life circumstances, just jump-in to whichever set of smart money ideas suits you best. Find your personal spot on the timeline below and start moving forward towards a solid, financial future.

Smart Money Ideas In Your 20’s

1) Budget Baby!

First off, you want to figure out how much money you are bringing in and where it is going. Your income may not add up to much just yet, making it very important you tally every dollar. Spend the time tracking your monthly expenses and creating a balanced budget.

Try using our free budget planning spreadsheet and weekly expense tracking worksheets. They will help make the process quick and painless, we promise! Fill in the quick form and you’ll immediately receive the Budget Bundle in your inbox.

2) Start Paying Off Debt

Work on paying off your high-interest debt first. That probably means your credit card balance. The average credit card interest rate in Canada is approximately 19%. Read how credit card interest is calculated here.

If you are like me, you came out of university or college with thousands of dollars in student loans. Now, the interest rates on student debt is usually lower than a credit card (approx 5% to 6%), but with mountains of it to pay off, you want the trek up to the peak to be swift. Therefore, make sure to pay off more than the minimum balance each month. The Government of Canada explains how to start paying of a student loan here.

Read: How to Save Money on a Low Income

3) Start Investing For Retirement

You may not have much money left over after paying for monthly expenses, but take some of it and invest. Even as little as $25 a month will grow over time thanks to compounding interest. You are young and time is definitely on your side. If you start investing early, retiring rich is definitely doable. Here are some Investment Ideas For Low and Middle Income Earners.

4) Contribute Money Into A Workplace Pension Fund

If you are a salaried employee, set-up automatic payroll deductions and join any savings programs (pension plan, group RRSP, stock purchase plan) your workplace offers. Many employers will match at least part of your contributions. Every time you get a salary increase, increase your contribution amount.

5) Save For An Emergency In A High-Interest Savings Account

While you are knocking off your debt and investing a bit of cash, set aside some money in a high-interest savings account for emergencies. They happen! Case in point the current, worldwide, coronavirus pandemic that is going on as I write this article.

Most financial experts suggest having 3 to 6 months worth of savings set aside, in a separate bank account that is easily accessible.

6) Insure Your Stuff – Renters Insurance

You may not want to spend money on renters insurance but imagine the jam you’d be in if there is a fire or flood in your apartment! Renters insurance will cover the cost of replacing your stuff and often the cost of staying in a hotel during the repairs. The average price is $15 per month. Well worth the peace of mind.

Smart Money Ideas In Your 30’s

1) Down with Debt And Up With Savings

The first smart money move to make in your thirties is to pay off any high-interest debt (credits cards, student loans, car loans). While tackling your debt, continue saving money in an emergency fund for any surprises life throws at you.

2) Ramp Up Your Retirement Savings

Now that your salary is starting to rise, increase your monthly contributions into a long-term investment account. A great, and easy, way to do this is to set-up automatic monthly contributions from your bank account into an Registered Retirement Savings Plan (RRSP) or a Tax Free Savings Account (TFSA). There is lots of debate among financial experts about which retirement vehicle is better, the RRSP or TFSA. Read Young & Thrifty’s TFSA vs RRSP: How To Choose Between The Two to find the right option for you.

Here are some more great investment ideas for women in their 30’s.

3) Save For a Down Payment On a House

According to a recent poll by the Bank Of Montreal, the average age of a home buyer in Canada is 36 years old. With the average cost of a house in Canada (2016) being $500,000, saving for that big down payment will take time.

Start investing to reach the 15 to 20% down payment recommended to purchase a house. The Financial Consumer Agency Of Canada can help you calculate how much money you’ll need for a down payment on your first home.

5) Prepare For The Cost Of Raising Kids

A study by Statistics Canada found that the average age a Canadian woman has children has been over 30 years old since the year 2010.

If you’re thinking of making a new addition to your family it is wise to start figuring out how much your new bundle might cost. Consider how much time off work you’ll want to take and how that will affect your income.

Take a look at How To Choose Between The 12 and 18 Month Parental Leave.

Kids cost money…from the initial expenses like purchasing a crib to the later ones, like paying for university. Once baby arrives, set-up a Registered Retirement Savings Plan (RESP) and make monthly contributions.

Don’t neglect investing in your retirement accounts though. If you are short on money, an idea we do in my family is asking relatives to give cash towards our kids’ RESP’s in lieu of birthday and Christmas gifts.

Smart Money Ideas In Your 40’s

1) Focus In On Retirement

It’s time to fine-tune your retirement strategy. If you are wondering how to invest in your 40’s, there are a wide variety of great investment options for women in Canada.

Check out our article, Investment Ideas For Women Over 40, for an in-depth look.

Continue contributing to investment vehicles such as the RRSP, TFSA, and workplace pension. You may want to adjust your investment portfolio if your tolerance for risk in the stock market is changing.

Also, pay attention to how much money you are being charged to manage your investments. Online brokerage firms and robo advisors can save you thousands of dollars in management fees that can instead be put towards your retirement.

Related Article: Top Canadian Robo Advisors 2020 – Which One Is Right For You?

2) Review Your Budget And Make Adjustments

If you’ve already made a budget….great! Take the time to review it now that your finances are changing.

If you’ve just been going with the flow, begin seriously tracking your spending and income.

Read How To Make A Family Budget for step-by-step instructions, from goal setting to budget making.

Creating a budget will allow you to find extra money for investing and give you some peace of mind.

Do You Need A Complete Budget Tool Kit?

Tools I’ve Developed To Help You Stay On A Budget And Get Out Of Debt

If you haven’t yet started a budget or if you are having difficulties organizing your current budget plan, don’t worry, I have a great new resource to help you. I’ve designed The Family Budget Planner to help my family, and yours, build a practical, time-saving budget plan.

No other budgeting planner is specifically designed to help families manage their finances. It will help you set goals for your money, track your income and expenses, pay-off debt, monitor your savings, and, of course, create a workable budget plan.

The Family Budget Planner is created with family living in mind and includes savings and spending trackers just for the kids. I have 4 young daughters, so I wanted to make a budget planner that includes all the kid’s expenses. There is also a mini-budget sheet for children to use – what a great way to teach kids about money!

If you are the kind of person who likes to have a ready-made plan (with all the organizational tools you’ll need) laid out before you, then The Family Budget Planner is designed for you. Get it and get ready for a sunnier financial future.

3) Avoid The “Bigger Is Better” Mindset

You’ve been working hard and it is starting to pay off. Debt is going down and your salary is on the rise. For most women, our salary peaks in our 40’s. So, it is tempting to splurge on some well-deserved big ticket items.

Some pampering is fine, but resist buying a huge house or fancy car with your extra cash. Instead, put that extra money into your retirement funds so you can maximize the amount of money you’ll have in your golden years.

4) Protect Yourself And Your Family

If you have a spouse, partner, or kids, ask yourself how they would manage if anything happened to you? Do you have life insurance to cover their needs in the event of your death? Not happy thoughts, I know, but you don’t want your loved ones to struggle financially in your absence.

You might want to get supplemental disability insurance as well in case you are injured and can’t work. Supplemental means in addition to what you are covered through your work’s policy.

While we’re on grim topics…if you haven’t made a will, do it now. Help ease the pain of your passing by leaving detailed instructions about who should get what and who should be in charge of distributing your assets.

If you have children you must appoint legal guardians for them in your will. Figure out who you want those people to be and to ask them if they’d be willing to take on the responsibility.

5) How Are Your Parents Doing?

When you’re in your 40s, your parents are likely approaching their retirement years. It’s time to have a chat about their money plans. Find out if they are still carrying any large debt, if they have life insurance policies, who they have assigned to make health care decisions, and execute their wills.

Smart Money Ideas In Your 50’s

1) Pick An Age To Retire

Have an age in mind when you want to retire and review your investments and savings to make certain you will have enough money. Don’t hesitate to talk to a financial advisor if you aren’t sure exactly how much money you will need to retire comfortably.

You need to ensure that all the pieces of your retirement plan are in place.

Even people who manage their own investments can profit from meeting with a financial planner. Find a fee-only advisor who charges an hourly fee and isn’t trying to sell you a product. You want them to be objective with your money.

2) Catch-up On contributions

Catch-up on retirement contributions to meet your target savings goals. Take a look at the Canadian Budget Binder’s article, How Not To Retire Poor In Canada, for advice on planning for retirement.

3) Keep Pushing Yourself In Your Career

Although many women’s salaries peaked in their 40’s, men keep earning more into their 50’s. Totally unfair! So, don’t be afraid to fight for what you’re worth. Keep taking courses to upgrade your skills and push your boss for a raise.

Your 50’s are also a great time to start your own side business. Have you always dreamed of flipping houses or starting a freelance writing career? Why not get started now? A new business venture could grow into a good money maker and help with your retirement goals.

4) Downsize Your Life

If you have children, they have most likely fled the nest, or are financially independent. You can increase your investment contributions once you stop paying for their expenses.

If your house is feeling a little empty these days, consider downsizing to a smaller one. Add to your savings with any money your made from selling your home.

Feeling ambitious? If you live in a city with a thriving rental market, how about renting out your old house instead of selling it. The rental income will add nicely to your investment accounts.

Another place to cut back on expenses could be from your life insurance premiums if you don’t have family dependent upon you anymore.

5) Decide If You Want Long-term Care Insurance

Your 50’s are a good time to purchase long-term care insurance. Long-term care insurance helps pay the costs should you become unable to care for yourself.

If you wait much longer, the premiums become very expensive. Plus, you could develop health problems that disqualify you from any coverage.

Smart Money Ideas In Your 60’s And Over

1) Create a retirement budget

Your 60’s is an ideal time to start crunching the numbers on your retirement budget. Your retirement date is probably just around the corner, which means you’re close enough to be able to accurately estimate your income and expenses. When making your retirement budget, remember that most expenses will probably go down in retirement, but medical costs might increase. In Canada, remember to factor in government retirement income programs such as the Canada Pension Plan and Old Age Security into your budget income.

Read: How to Stick to a Budget: 12 Doable Tips

2) Practice Being Retired

Spend a couple of months practicing being retired. Live off the income you have planned for your retirement and save the rest. If you can, take an extended leave from work and see if you enjoy filling your days with the activities you plan on doing when you are retired. This will give you an idea if you are ready for retirement life, or if you want to keep working for a few more years.

Related Article: Top Tax Return Software For Canadians – File For Free

3) Review your investments

One of the best investment ideas in your 60’s is to prepare to make the switch from putting money into your retirement accounts to making withdrawals. Before that happens, it’s important to get those accounts adjusted to reflect your tolerance for risk.

This could mean re-balancing your investments in preparation for retirement. Normally this involves transferring most of your investments into bonds, with the remainder in stocks. High-dividend stocks can generate a regular income for you while your traveling the world.

This is also a good time to meet with an investment advisor who has experience in retirement planning.

4) Continue to Save For Your bucket List Items

Reaching retirement doesn’t mean you have to stop making smart money moves in your 60’s and beyond. Continue setting savings goals for yourself and adding to your investments.

There’s nothing to stop you from saving for things like that vacation home on the lake you’ve dreamed about, or that tour of Italy.

6) Make Sure Your Estate Is In Order

Make certain your family is all set to handle your estate should something happen to you. They will be grief-stricken and having specific instructions about how you want your estate handled will be a big help.

Have you prepared your will? Do you have estate planning tools such as funds and trusts set up for your family? Are your loved ones aware of your wishes?

How you lay the groundwork for your retirement will make the transition between working full-time and your golden years easier.

I hope these smart money ideas for women at every age have helped set you up to enjoy your retirement adventure.

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