Smart Money Hacks Women Can Use Right Now

If you're a woman and you have financial accounts in your own name that you manage, take a moment to give thanks. It hasn't been very long since we even got this right as American women -- it was the 1974 passage of the Equal Credit Opportunity Act that made it possible for us to open financial accounts without discrimination based on sex.

The ECOA predates my life, but by less than a decade, which makes it all the more remarkable that I can write about personal finance as a career -- a job like mine would be quite difficult to do if I wasn't allowed to get firsthand experience of what I write about.

On that note, from one woman to another (you, the reader!), here are a few smart money hacks you can jump on right now to put your money to work for you.

Maximize your savings

If you don't have a high-yield savings account yet, this is a sign that it's now time to open one. According to research from The Ascent about savings, just 31% of Americans have a savings account paying at least 4%. Those of us who do are earning passive income -- our money is making more money for us. Personally, I've earned over $1,000 extra from my savings account this year -- the bank I'm with is currently offering an APY of 4.25%.

Review our list of the best high-yield savings accounts and you'll find APYs at 4%, 5%, or even more. Online banks tend to offer the best APYs since they don't have the costs of maintaining physical bank branches like brick-and-mortar banks do. Pick out the best one for you (be mindful of fees, as they'll eat into your returns) and start saving.

Invest for your future

The percentage of women who invest is on the rise -- per research from The Motley Fool about women and investing, 67% of us invest outside of retirement plans, which is up from 44% in 2018. Unfortunately, our retirement income lags, at just 83% of men's retirement income. This is due to a few factors, including a lack of financial education, less confidence in our abilities and judgment, and the gender pay gap (more on that below).

So what can you do? The best brokerage accounts make it incredibly easy to start putting aside money for your future. Don't assume that you must have all the knowledge to start investing -- it's OK to start slow and build your knowledge over time. We cover a lot of investing topics here at The Ascent, so check out our articles on investing.

And don't think that a successful investor must know a lot about different companies to pick stocks. If the prospect of this fills you with anxiety, try investing in an S&P 500 index fund instead. These track the performance of the broader stock market, which has returned an average of 10% per year for the last 50 years. Get started as soon as you can to take advantage of compound interest.

Get professional help

I used to think that financial advisors were only for rich people, but I was so wrong. I started meeting with a Certified Financial Planner early last year, and it changed my life. At the time, I had a lot of debt, no savings, and was feeling rather hopeless about my financial prospects. Plus, I wanted to buy a house but had very unrealistic expectations of what doing so would require. Thanks to the wisdom, encouragement, and support of my CFP, I spent 2022 turning my finances around. As 2023 comes to a close, I feel more confident than ever about managing my money.

If you've never met with a financial advisor before, I recommend finding one. Get someone who is a fiduciary (this means they must put your financial best interests ahead of their bottom line), and check their credentials with FINRA's BrokerCheck database.

Learn your worth

You might think the gender pay gap is a thing of the past, but unfortunately, it's not. In 2022, American women earned an average of just $0.82 for every $1 earned by a man, according to Pew Research Center. If you're a queer woman, you've got the LGBTQIA+ pay gap to reckon with, too -- queer women earn $0.87 per $1 earned by a typical worker, as reported by the Human Rights Campaign.

The best way to learn how much you're worth is to research salaries for your field (Glassdoor is a great place to start), and to talk about money with all the women (and non-women) in your life. Yes, this includes discussing salaries with coworkers -- regardless of whether your employer tries to forbid you from doing so, you have the right under the National Labor Relations Act of 1935. You may want to avoid talking about it while you're working, though -- save the conversation for outside of work hours.

If you find out you're earning less than your male colleagues, for no discernible reason, open a discussion and a negotiation with management. And consult with an employment attorney if you need to.

As a woman, you're unfortunately at a financial disadvantage, and no one will fix it for you -- you've got to be the one to step up. Consider using these smart money hacks to get your finances in order. You got this!