Women & Wealth | March 7, 2018

Financial Planning | March 7, 2018

3 Steps to Financial Empowerment for Women

by  Kelli A. Adams, GW & WADE COUNSELOR

Think for a moment about the word “empowerment.”  What does it mean to you? Can you think of a time in your life when you felt empowered? 

When I hear the word empowerment, and specifically how it applies to women, I think of a strong, confident woman who is in control of a situation. It’s knowing exactly what she wants and following a plan to achieve that goal. When she feels empowered in her financial life, it allows her to make more confident decisions as it pertains to earning, spending, saving and investing.

We’ve noticed over the past several years that more and more women are in charge of finances. We believe this can be explained by 4 things: 1) women tend to outlive men; 2) many women who are married – whether or not they have families – are taking charge of their finances; 3) divorced women are taking over their own finances post-divorce; and 4) more women are choosing to remain single. Financial empowerment is essential for women because we have the ability and capability to make a significant impact on the family finances, but we can’t do that if we don’t “Know Our Numbers” (more on that to come).  

Suppose you’re married and your spouse manages the household finances: paying the bills, filing the income taxes and managing the investments. The fact of the matter is that you as a member of the household participate in making decisions about how money is spent. If you and your spouse don’t have frequent conversations about the household finances, then you are unlikely to know whether your spending habits are appropriate for your level of income. It’s incredibly important that each of the responsible adult members of the household is aware and has agreed upon short and long-term financial goals. This way, you end up making spending, saving and investing decisions based on facts. This leads to a feeling of empowerment.  For example, if I walk out of a store without two things because I decided it wasn’t part of the budget that month, I may determine to cut back on something else the following month in order to afford those two items. THIS is financial empowerment. YOU are in control of your own destiny. 

So, how can you become more financially empowered?  We’ve put together a step-by-step plan to help you achieve your own sense of financial empowerment. 

Step 1:  Know Your Numbers

Step 2:  Analyze and Devise

Step 3:  Execute the Plan 

Step 1:  Know Your Numbers

There are 3 numbers that I think every woman should have in the back of her head at all times:  

1. Household Net Worth: Assets minus Liabilities = Net Worth

  • Pull out a piece of paper (or, my favorite, an Excel spreadsheet) and list all of your assets, including investment accounts, real estate, checking/savings accounts, retirement accounts. Add that all up and those are your total assets. Let’s assume you have $1,000,000 in total assets. 
  • Then below that, write down your liabilities, including revolving credit card debt, student loans, mortgage, car loans. Add that all up and those are your total liabilities. Let’s assume you have $400,000 in total liabilities.
  • Now take your total assets ($1,000,000) and subtract your total liabilities ($400,000). That equals your total net worth ($600,000). 

Here is a Net Worth Statement that can help you in listing your assets and liabilities. 

2. Household take-home monthly income: How much are you and/or your spouse bringing home each month from employment?

3. Household monthly expenses: How much do you spend each month on your mortgage/rent, utilities, car expenses, groceries, eating out, loans, etc?  I recommend that you look at 12 months’ worth of expenses to get a good monthly average. Be honest with yourself!  If you had a month where you spent $1,000 on a special weekend away, it’s easy to brush it under the rug and exclude it from your budget because “it won’t happen again this year”. But the reality is that it probably will or there will be something else that will cost that much. It’s okay to spend money on things you want – as long as you are spending within your means. 

Here is a cash flow analysis worksheet that I often give to my clients to help them identify their monthly expenses. 

Being aware of these numbers is key to your financial life. If you know that your monthly income is $10,000 per month, but you’ve been spending $12,000 a month on average, it is clear that you need to find ways to trim your expenses. But if you’re not aware of what those numbers are in the first place, then you don’t necessarily know that you’re over-spending. We need to be aware of what the numbers are in order to make appropriate decisions. 

Step 2:  Analyze and Devise

OK, the hard part is done. You’ve identified what your numbers are. Now, I want you to review those numbers. Is your net worth what you expected?  Are you spending less or more than you thought? Chances are that you will be surprised by some aspect of this exercise. That alone will allow you to feel empowered! Even if you determine that you’re spending significantly more than you thought you were, the truth is that now you “Know Your Numbers”!  That alone will allow you to feel empowered!  (Yes, I said it twice). You can now make financial decisions based on facts.  

Set your goals: When do you want to retire? How much do you need to retire? This is where we can help – we help you analyze your situation and determine the answers to those questions. We then help you get there. But, you can also do this yourself using free digital calculators and other on-line resources. 

Maybe you’ve determined that your net worth should be higher based on your spending and your retirement goals. That means you need to save more to achieve a higher net worth. Wonderful, now you have a goal to save more.  But, don’t forget that you also want to invest those savings to maximize long-term growth.  

No matter what your net worth is, everyone needs to have a monthly budget.  One person may spend $10,000 a month and another spends $100,000 a month. Both of those individuals need to ensure that their income is sufficient to meet those needs. No one is exempt from “Knowing Your Numbers”! 

Step 3:  Execute the Plan

Although it may seem a bit obvious to say, "execute the plan", it’s an important step to financial empowerment. Specifically, you’ll be more successful at saving when you break your plan into smaller steps. 


  • Let’s say that you have determined you need to save an additional $6,000 per year. That may seem like a daunting amount, so I recommend breaking it down to monthly savings instead. In this case, you need to save $500 more per month. OK, that’s more doable. Now you need to look at your monthly expenses to see where you could cut back on spending. There are always ways to cut back – you may not like them, but you’ll feel that sense of empowerment at the end of the first month when you achieve that goal. I promise! 
  • If you’re having a difficult time cutting back on your spending, break your goal down further. For example, rather than reducing dining out to once per month, which could be very restrictive for many families, try bi-weekly. When your goal is reasonable, it’s more attainable. 

Be sure to revisit your plan at least every 12 months and adjust as needed. For example, if your income increases, adjust your plan. This could mean: save/invest more, gift more or spend more. Ultimately, it’s up to you, yet your short and long-term goals should drive your decisions. 

And, importantly, give yourself a break. Not unlike dieting, if you fall off the wagon one month (for most, that would be December), get right back on the next month. Don’t give up just because one month didn’t work out. Keep at it. 

Keep the following in mind:

Whatever you spend today reflects how much you have available for spending in the future. Furthermore, the more you spend now, the more you’ll need to save for retirement. It’s not reasonable to spend $100,000 per year and then immediately reduce your spending to $65,000 per year upon entering retirement. Rarely does this work. Reducing spending is a process. Entering retirement is the worst time to begin reducing expenses. Instead, you want to acquire these lower spending habits well before retirement. You need time to adjust, and as you adjust you’ll feel more in control and, therefore, empowered. 

I like the suggestions in How to Start Reducing Your Expenses Before You Retire, in The Balance, about several financial categories to begin the process of cutting back on your spending pre-retirement.[1] 

In Closing

For many women, the path to financial empowerment can be a rocky one, requiring you to confront financial risks, fears and occasionally admitting to not knowing enough. Yet, without facing these obstacles, it’s unlikely you’ll reach your full financial potential. 

It’s my belief that a woman who is empowered possesses confidence and the latter almost always breeds financial success. 

It’s important to know that you don’t have to go through this process on your own. There are many resources available to help you achieve financial empowerment. At GW & Wade, we offer Women & Wealth educational workshops that focus on different facets of women’s financial lives. 

If you’d like to attend a Women & Wealth event, please sign up for our quarterly newsletter to keep abreast of upcoming events.

Finally, if you have questions about your financial future, please contact us. We welcome the opportunity to help you achieve your goals. In the meantime, I hope to see you at a future Women & Wealth event. 


The information provided above is general in nature and is not intended to represent specific investment or professional advice.  No client or prospective client should assume that the above information serves as the receipt of, or a substitute for, personalized individual advice from GW & Wade, LLC, which can only be provided through a formal advisory relationship.  

Clients of the firm who have specific questions should contact their GW & Wade Counselor. All other inquiries, including a potential advisory relationship with GW & Wade, should be directed to:

Laurie Gerber, Client Development

GW & Wade, LLC

T. 781-239-1188



[1] https://www.thebalance.com/how-to-start-reducing-your-expenses-before-you-retire-3958910


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