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MOTHERS AND THEIR MONEY

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Women are better at managing cash in the short term, experts say.
Women are better at managing cash in the short term, experts say.

As MZANSI mums were showered with love and appreciation this past weekend, we know that sometimes they don’t look out for themselves as well as they should . . .

According to the 2016 Old Mutual Savings and Investment Monitor, women are more aware than men in many areas, including saving and sticking to budgets.

But they fall behind men in long-term investment strategies. Men continue to be more pro-active when it comes to investing their money in savings and investment channels which will ultimately grow their net wealth.

The monitor also reported that 45% of men have savings as opposed to only 39% of women, despite women being better at short-term saving, with 22% setting money aside for specific expenses at the end of the year, or other annual expenses, compared to 16% of men.

Lizl Budhram, head of advice at Old Mutual Personal Finance, said while it’s wise to cut down on expenses to save money each month, mums must think more about their long-term investments.

“Saving is essentially postponed spending, while investing means you put these savings to work in order to earn a return. The difference is that when you save, you are wasting less money, but when you invest, you are setting money aside in an investment so that you can earn interest or a return – you make your money work for you.”

About 41% of women are unsure of where they should get the financial advice they need.

“A major downside of low financial confidence is that you run the risk of ignoring long-term goals such as saving for retirement – and this could prove to be a terrible disaster for your future financial security.”

The monitor noted that when it comes to grocery shopping, many households are always looking out for discounts and specials at stores.

Trading down, whether it is to a cheaper supermarket chain or buying cheaper brands, is especially prevalent in lower income households – R14 000 or less a month – whereas higher income households – R20 000 or more – focused more on buying in bulk.

Budhram believes that Mzansi women need to increase their confidence and empower themselves by improving their knowledge and understanding of the financial choices they can make.

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