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How to relationship-proof your money

How to relationship-proof your money

A staggering 60% of Australian women in a relationship, or three in five, are leaving themselves vulnerable to the risk of ‘financial abuse’ by not ensuring their own financial independence, a new study has revealed.Research from CoreData’s Female Financial Abuse, which surveyed 801 women nationally, found that 60.5% of women in a relationship do not have a single asset of their own, held separately from their partner, in their own name.

It was further revealed that 70.3% of those in a relationship feel at least somewhat reliant on their partner for financial support, while only 39% had their own savings account and just 33.5% had their own transaction account.

Kristen Turnbull, Head of WA at CoreData, says that women who “face up to reality and take control of their financial situation are less at risk of financial abuse”.

Financial abuse is defined by CoreData as the risk that women are exposed to by virtue of a relationship breakdown, manipulative relationship, or their partner’s financially irresponsible behaviour such as gambling or credit card debts, which could leave the woman financially insecure.

“A lot of women are leaving themselves vulnerable – no matter how much they trust and love their partners – by not taking the steps to financially educate themselves and attain a level of financial independence from their partner,” Turnbull says.

“Importantly, it’s often the most vulnerable that appear to be the least aware of their vulnerability.”

While the large majority (85.8%) of women admitted to worrying to some extent about money and the future, more than half (53.2%) of women say they have no financial plan and only 10.5% feel they have very strong financial knowledge. In order to relationship-proof your money and your financial future, it’s imperative for women to get educated about their own finances, Turnbull says.

She believes financial services companies have a role to play in this respect, to help women to better educate themselves about their financial situation and to help them take control of their financial future. Every woman has the right to know her financial situation, even if you are not earning an income and contributing financially to your household.

To get some control over your financial situation, consider some of the following:

  •  Ensure you know the log-in codes and passwords to your family’s internet or phone banking accounts, so you can review your current financial situation.
  • Read all bank statements and credit card statements when they arrive in the post, rather than blindly handing them all to your partner. If you see questionable spending habits, question them – or if you don’t feel comfortable doing so, keep a close eye on future receipts to monitor the situation.
  • Get an understanding of your family budget: how much do you spend each month? How much does your family earn? Do you earn more than you spend – or the other way around?
  • Start saving – as a broad goal, you should aim to save 10% of your household income each year. If you don’t earn an income yourself and your partner keeps a tight hold on the purse strings, and is not open to you becoming involved in your financial management, do you best to set aside $20, $50 or $100 at a time into a personal, separate savings account, to slowly build your own financial independence.
  • Get educated – about your money, your income, your budget, your expenses, your financial situation and the broader finance market. The more educated you area, the more questions you know how to ask and the better decisions you will make – leading to a more financially secure future.