Are you ready to wrap your arms around your money and see where you stand, but you’re pressed for time? We get it. Women are busier than ever these days, being tasked with more responsibility than ever. With all of this, it feels impossible to find the time to feel financially prepared In fact, 39% of women say that the pandemic has caused them to consider a change to their working life, citing childcare, homeschooling needs, and the cost of caring for kids as the top three reasons for doing so, per research from Fidelity. Sixty percent of women are more stressed than they were pre-pandemic, and 80% — yes, you read that correctly — of those women say everyday finances top the list of their stressors.
So, what can women do to quell our financial stress and feel financially prepared without taking up too much time? It’s so important to understand your money and see what paths you need to take to reach your goals. We checked in with experts who weighed in on the best 5 things that you can do now, in 60 minutes or less, to get to a better place. Because even if you’re in a time crunch (and we know you are!) you’ve always got time to step into the driver’s seat of your financial life.
1. Review your credit report to feel financially prepared
Your credit score is an important part of your financial life as it can have an effect on major life goals like getting a mortgage or an auto loan, explains Michaela McDonald, CFP. “Your credit score will be used to determine not only your likeliness of approval, but also the terms and conditions of the loans as well,” she says.
This can be done in about 30 minutes. Here’s how:
- You can review your credit report for free at sites like creditkarma.com and annualcreditreport.com.
- Take time to review each debt listed on your credit report to confirm it is yours.
- If you find an error on your report, you’ll want to dispute it with the credit bureaus immediately.
Your credit report — and credit score — carry a lot of weight in your financial life, and often you might not be able to achieve some of your biggest goals if you’re lacking in this area. Ensuring everything is in the right place before embarking on other major financial moves is the best first step.
2. Make a list of your top 3 financial goals
Now that you’ve crossed your t’s and dotted your i’s, it’s time to start working toward those big ticket items you’ve always dreamed of having, or goals you’ve yearned to accomplish. Accomplishing these will surely help you feel more financially prepared for anything. “Picture goals that excite you! This could be anything from saving for a car, paying down debt, saving for your child’s college, or saving for retirement. A great place to start is by picturing what you want to achieve by the end of the year. That will make the goal more real and achievable in your mind. I also suggest making a “micro goal,” with what you can accomplish this week/month to give yourself a win and build momentum,” says Roberta King, VP Branch Leader in Fidelity Investments’ Columbia, MD Investor Center.
Yes, we know how overwhelming it can sound to make a plan for life goals in just an hour… But instead of tasking yourself to get it all done in one day, make an ongoing list that you can add to whenever something comes to mind. We recommend keeping it in an easily accessible place that you’re not likely to misplace, like the notes app in your phone.
3. Plan when you’ll need the money to achieve your goals
Figure out your time horizon and how much you expect to need for each of those goals you added to your list. “Tools like Fidelity’s Planning & Guidance Center can help you keep track of your goals and even assign them to specific accounts so you can see progress,” King says.
But how to get this done, you ask? “With so many online planning tools and resources available, taking a snapshot of your financial picture and mapping it to your goals is easier than it sounds,” King says. Here’s what she recommends:
- First, know your net worth — list everything you own vs. everything you owe.
- Next, calculate your cash flow surplus or debit, how much you bring in compared to what you spend.
- Once you know these numbers, your opportunity to move closer to your goals will begin to reveal itself.
- Automating contributions into different savings and investing accounts makes it easy to save over time, without having to think about moving money all the time. Simply set up the recurring contributions, and watch the progress add up over time — you’ll reach these goals before you know it.
4. Make a plan for your debt
You’ve saved a ton, but your credit cards are still racking up debt. It’s time to tackle what you owe, continuing on your journey to feel more financially prepared. “Credit card interest rates are no joke, leaving high balances on your credit cards can rack up some serious interest charges and damage your credit score. Getting a pay-off plan in motion will help you feel in control of your debt and hopeful for your financial future,” McDonald says.
Start by reviewing your balances and your interest rates to figure out what debts you owe — yes, for all of your credit cards. Choose a repayment method that works for you. McDonald recommends the “snowball method,” which targets the smallest balance cards first, or the “avalanche method,” which targets the highest interest rate cards first, no matter their balance. “The snowball method can be very motivating to pay off entire cards sooner, but the avalanche method will likely save you more money in interest charges over time,” she adds.
Then, pick a target date to be completely debt-free. Oh, and planning all of this should only take you about 30 minutes. Win, win.
5. Track down that old 401(k)
“Many people have 401(k)s from old jobs that they never took the time to rollover into their current 401(k) or another retirement qualified account. It’s very common to drag your feet on this, as the process involves a bit of paperwork and research,” McDonald says. But once you locate it, the rest of the process is a piece of cake.
Start by logging into that old account and downloading the rollover paperwork. You can then fill out and submit the rollover paperwork — that is if you have a new, active retirement account — and the transfer process will begin, just like that.
Doing this can help you organize your retirement savings, and combining your savings into one place will give you a better idea of where you stand now and what you have to do to work toward the retirement of your dreams.
Yes, you can — and should — take an hour to feel financial prepared
“Taking one hour to review how you’re doing against your financial plan can make a big difference in achieving your goals. One of my core beliefs is about focusing on the outcome; your intention and action will then follow,” says King.
