7 Big Money To-Dos For Women in their 20s

Today’s guest post comes to us from Kyle Kam of Moneymax.ph, your go-to website for comparing credit cards, personal loans, insurance and other products.

Pinays enjoy a level of equality not shared by other women in many countries. That’s because the Philippines ranked 7th out of 145 countries in the 2015 Global Gender Gap Report.

The Philippines ranked well when economics, health, education, and politics are taken into account. The last one is not so surprising since we’ve had two female presidents and women participate in the election process regularly at all levels of the government.

But there’s another side to the discussion of gender equality in the Philippines that has to be pointed out. 2009 data from the National Statistical Coordination Board says that women (11.2 million) “have the largest magnitude of poor among the basic sectors” second only to children (12.4 million).

Women in their 20s are at a particularly good position to plot their financial future. They have choices to make at this stage in their life that could impact their future wealth. So what can women do to battle poverty? Let’s look at some goals that women should aim for.

1) Have a Financial Goal – It can be hard to create a financial strategy if you don’t have a goal in mind. Take some time to reflect on what’s important to you and plot your strategy on how to achieve it. Do you want to retire early? Earn a million pesos before you reach 30? Write it all down and post that goal somewhere where you can see it every day to help you motivate yourself to reach that goal!

2) Distinguish Between Wants and Needs – It’s a simple enough idea and many could scoff at being reminded about distinguishing between wants versus needs but many still can’t quite tell these two apart. The proliferation of high-end brands (read: expensive) is proof that many still spend more money on items that most likely has a more affordable alternative.

3) Start Investing – Go for something less expensive the next time you go shopping and set aside the money you saved into investments. The best part about investing in your 20s is that if you do it right, you can earn a lot more for your future needs. One example is stocks. Buying stocks early can help you earn more from dividends and stock splits and those are things that you earn more of the longer you hold on to the stocks.

4) Protecting Your Assets – There are different types of insurance that can help you protect your assets. Car insurance is one such example and there are now insurance providers who have plans that cater specifically to women. Insurance is important because accidents do happen and having insurance can protect you financially if these accidents should occur to you.

5) Learn How to Track Your Expenses – Pinoys still prefer to shop with cash even as credit cards and debit cards are now widely available. One advantage to having these electronic payment tools is that you can track your expenses better with the help of online banking tools and the monthly statements.

Knowing where you spend your money on helps you find out whether you’re overshooting your budget (if you’re keeping track of your budget in the first place). If you still prefer to use cash, using a spreadsheet or one of the many budget tracking smartphone apps available can help you do the task of tracking your expenses easily. You’ll have to do it every day though so diligence is important here.

6) Clear Your Debts – If you have debts, make an effort to clear this as much as possible. Compare interest rates on what you’re paying on your debts versus what you’re earning on your savings account and you’re likely to discover that you’re paying more in interest on your debts versus what you’re earning on your savings account. This means that you’ll save more money in the long term if you prioritize paying off your debt over building your savings.

7) Start an Emergency Fund – If you’re in your twenties, you will most likely switch employers a few times. Sometimes you resign from your job, sometimes you lose your job. Don’t feel too bad, it’s just the way things are. And that’s one reason why you should always have an emergency fund to help tide you over if you lose your job suddenly. You can put a larger part of it on investments when you feel that you have an adequate rainy-day fund.

Awesome, thanks Kyle! (When Kyle’s not working and reading personal finance blogs, you’ll find him at home watching battle rap videos the whole day. You can follow him on Twitter @undisputedkyle.) For more information about Moneymax.ph, please visit their website.

Any other money to-dos you think a 20-something should aim for? Share them with us in the comments below!