Women and their money

WOMEN, on average, are wealthier and more empowered than before. A UBS report – Gender-lens investment – The state of women in 2025 – indicated that from 2015 to 2024, the number of female billionaires grew to 344 from 190, up 81 per cent, driven mainly by female business owners. Still, it pales in comparison to a 49 per cent rise in the male population, which is far larger at 2,338 last year.

It augurs well that more women have been completing formal education and participating in the workforce. There is also greater women representation in management roles. All this bodes well for the fairer sex. With greater income potential, women will have the means to be financially savvy.

It is essential for women to be aware of the obstacles they may face, particularly those who are less educated or work in industries with lower-paying jobs. Furthermore, women are more likely to take a break from their career to devote time to raise a family and/or be caregivers to the elderly. Studies showed that more women than men had at one point taken a career break. This could result in reduced opportunities for career advancement and lower lifetime earnings compared with their male counterparts.

The UBS research points to the “motherhood penalty” as a key determinant of the “stubborn” gender wage gap. It noted that a study of the wage gap in Denmark found that having children left a 20 per cent long-term earnings gap for women, starting with her first child.

More recent data from elsewhere, such as Pew Research, found that women in the US lose ground on pay parity during their child-bearing years. An American woman between the ages of 25 and 34 in 2002 earned, on average, 92 per cent as much as a man her age. By 2022, a woman in this same cohort now aged 45-54 earned 84 per cent of a male peer’s wages.

A study from Japan validated these findings: both first and second pregnancies triggered an earnings penalty, but not because women did not return to work after pregnancy.

Over time, women’s employment rates recovered, but their work hours and wage rates remained depressed, resulting in an overall earnings gap.

Financial planning is of paramount importance to ensure women do not outlive their nest egg.

Here are four financial tips for women to stay on top on their finances.

1. Leverage the power of two

It is prudent for a woman to be financially independent and not rely completely on their spouses, children or anyone for that matter. With women living longer – on average by five years – than men, and likely to spend more of their lifespan in poor health and with disability, a bigger nest egg is usually required to fund their twilight years.

Furthermore, the family coffers would usually have little left over after spending on the children’s education and the husband’s medical needs.

Therefore, it is crucial for women to be self-reliant on money management. By empowering themselves continuously with financial know-how, they will be able to make informed decisions and manage their finances well.

Though I’ve often advised that “a man is not a financial plan”, I would like to encourage women to leverage the power of two, particularly for building wealth from big ticket purchases such as home ownership, and through joint investment and banking accounts.

What can you do?

• Start planning for the long term.
• A comprehensive financial plan eliminates uncertainties and helps you manage your money better.
• Get over any fear of financial jargon by empowering yourself with financial knowledge on budgeting, credit management, insurance, investing and planning for long-term goals such as retirement.
• Equip yourself with a skill set that will make you capable and prepared to earn a living via side hustles, if necessary.

2. Safeguard your interests – be involved in your family’s financial planning

Some women prefer leaving financial planning to their more money-savvy partners. The UBS report indicated that in an average household, women are typically the CFO (chief financial officer) of the family. They are the ones most likely to set up the family monthly budget and pay the bills. Male partners, on the other hand, tend to be the CIO (chief investment officer) and take the lead when it comes to retirement planning, longer-term investments and financial services providers – that is, issues that effectively help increase the family wealth.

Millennial women are no exception, with 51 per cent of them stating that they are likely to defer large investment decisions to their spouse after marriage, although 88 per cent are quite happy to participate in longer-term finance while single, stated the report.

However, be mindful about the consequences should unforeseen circumstances arise, such as a divorce or death of the spouse. Who then takes charge of the finances? Are there sufficient funds to cover outstanding liabilities (for example, mortgage and car loan)? They might be in for a rude shock if little or nothing was done to cater for the needs of surviving family members.

Separation and divorce can also pose risks for many women as they could be left with far less when a marriage breaks down.

What can you do?

• Even if you decide that your husband should take full control of all financial decisions, it is prudent that you have access to the accounts and be kept abreast of the money flows, insurance plans, and investments.
• Check if there’s a financial plan in place that deals with liabilities (mortgage and car loans).
• Find out what money sources will fund these loans and the provisions for family members, and who are the beneficiaries if the breadwinner dies prematurely. Common estate planning tools include a will, Central Provident Fund (CPF) nomination, Lasting Power of Attorney, insurance nominations, and a trust.
• Consider setting up a separate savings pool to fund your specific goals and ensure that you can maintain financial independence and quality of life regardless of what the future brings.

3. Make your money work harder for you

Past research has highlighted that female investors possess positive investing habits. They spend more time verifying information through researching, are more likely to stick to a plan, and less likely to try to time the market or give in to knee-jerk actions amid market volatility. They are also more focused on risk management than men. This includes the use of stop losses, trading less and checking their portfolio performance less often.

What can you do?

• Be mindful of not just saving but making your money work harder for you.
• Have a plan to build up your savings by being disciplined about setting aside a fixed amount on a regular basis. This will become your dry powder that can be allocated to an investment portfolio that is aligned to your risk appetite and needs.
• Be mindful that a balanced and diversified portfolio (which comprises cash and suitable asset classes) can help take advantage of opportunities to keep up with inflation, accumulate wealth and have a sustainable retirement.
• Understanding how government initiatives such as Supplementary Retirement Scheme and CPF schemes work will be advantageous too. For instance, if you have low CPF balances, your husband can top up your CPF account. Both of you will benefit from the CPF interest that will be paid in the respective accounts and there is peace of mind as you would have your own source of lifetime retirement payouts.

4. Female illnesses and longer life expectancy – prepare for the unexpected

As women tend to outlive men, they are far less likely to have a partner to care for them in old age.

In addition, women are more prone to certain medical conditions such as musculoskeletal problems and pregnancy complications, and some critical illnesses such as breast/cervical cancers.

What can you do?

• Consider sufficient long-term insurance cover, in the event of the demise of your spouse.
• Have adequate insurance plans that cover female-related cancers, hospitalisation and critical illnesses.
• Be mindful to review and adjust coverage to prepare for rising costs of critical illness, disability and healthcare in retirement.

The writer is head of financial planning literacy at DBS Bank, and author of bestsellers Money Smart and Retire Smart.