What smart women do in their 40s to be financially fit in retirement

How to take control of your money.

In our forties, as women, we take control of our money stories. We’re often moving past the brain-fog of small children, and we’re looking ahead with clear eyes. The reality is, that while men reach peak earning potential in their fifties, for women that happens in our forties. It’s a crucial decade to make smart adjustments to the way we handle money. A shift here and there, and some time spent considering your financial future, can make a huge difference down the track. Here’s what smart women in their 40s do to secure their future.

They start investing, even just a little

Now is the time to diversify a little. If you’ve been focused on your home until now, consider putting money into other asset classes. If you feel overwhelmed, a financial adviser can help recommend assets that fit the amount of risk you’re willing to take and the returns you expect. You might also want to invest in companies that align with your own values. Investing can also mean spending on qualifications and courses that allow you sure up your career longevity.

Now is the best time to plan ahead for the future.

(Credit: Getty)

They go hard on their mortgage

Life is expensive and the cost of living is rising, which means many of us are buying properties later and paying them off for longer. All of which means, our 40s are the time to consider strategies for paying our home off faster. One of the easiest ways is to review your mortgage repayment schedule. Are you in a position to make extra repayments? Can you increase the frequency of repayments? Could you access a more competitive interest rate?

Cheree Pedley, Senior Executive – Head of Strategic Change Projects, La Trobe Financial says now is the time to find out. “Even changing the frequency of repayments from monthly to fortnightly will help in paying off your mortgage faster. Don’t be afraid to ask your lender for an interest rate review. Set a fixed payment amount higher than the minimum monthly repayment. Every little bit counts.”

Statistics show women in their 40s are at peak earning potential.

(Credit: Getty)

They optimise their super

Statistically, women are said to have at least 30 per cent less super than men the same age. So it’s important to find ways to grow super more aggressively in your forties. Experts agree that there are a few ways to do this. One is voluntary contributions either from your pre- or post-tax earnings, which have various tax advantages. Another is salary sacrifice, which means deciding to put more of your pre-tax salary into your super fund. It might not seem like much, but it really adds up. Finally, look at your super fund and answer a few questions: Is your super all in one fund? How is your super invested? How is your fund performing? How high are the fees? Become a more active participant.

Lilian’s story “I love hitting my 40s. I have achieved a financial independence and understanding that I did not have in my younger years. This means taking control of all aspects of my financial future from investments, superannuation to insurance cover. Whilst I have been in the finance industry for over 22 years, I have deliberately enlisted the help of a trusted advisor. I believe strongly that having a specialist look out for your best interest eliminates personal blind spots. Annual reviews are also a must as personal situations evolve. Take the time to invest in your own financial freedom.”

Lilian Chin, Director Client Partnerships, La Trobe Financial.

They consider the worst-case-scenario

Yep, we’re talking estate planning and some other important steps to protect you. First, make sure you have a will and ensure your power-of-attorney is up-to-date. Then, consider what happens if you can no longer earn an income. It may be worth considering Income Protection (IP) insurance, which enables you to receive 75 per cent of your income if you need to step away from work due to illness or injury. It’s often tax-deductible, but have a chat with a financial adviser if you’re unsure about policies and fine print. Perhaps the smartest thing women in their 40s can do when it comes to their financial future: ask a lot of questions!

Brought To You By La Trobe Financial. ‘Looking out for you’.

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