A Complete Guide to Financial Independence for Married Women

Despite the rising number of women in the workforce, financial freedom is oftentimes just out of reach for women. This is especially true for married women, who will often merge all their assets with their husbands upon marriage. An unbalanced relationship can happen in any type of partnership, of course, but it tends to happen most with heterosexual relationships.

Unfortunately, women have historically lost control of their finances when they marry. Why is that? Well, women will leave their jobs when they marry, merge their wealth, or just defer all financial management to their partners. Married men will often expect their female partners to give up their careers to take on caregiving responsibilities and other unpaid work instead – and without question. Society has historically punished married women and LGBTQ+ people in the workforce for any gaps in working history. Sometimes, these decisions are joint decisions, and other times, it’s a joint decision due to family pressure or childbirth, among other reasons.

When women do not have their own financial lives and their independence in marriage, it can lead to a skewed relationship. To avoid major relationship imbalances, we always recommend women empower themselves – financially – in terms of earning potential, financial literacy, and financial decision making.

For example: you may have different financial goals than your husband. Alternatively, you may also have similar goals to your husband – but different strategies to achieving those savings goals.

Financial independence does not mean encouraging financial secrecy towards each other. Instead, it’s about encouraging financial freedom and financial autonomy. Here’s our complete step-by-step guide on how to be financially independent as a married woman. 

What is financial independence?

Financial independence is the ability to pay for your own living expenses with your income or wealth, without having to be dependent on others. Some do this through investments, and others do this through passive income, while others do this by budgeting and family planning. The reality, too, is that financial planning differs for women and men.

Why should a woman be financially independent?

Financial independence is an important goal for every woman, no matter whether you’re single, dating, married, or divorced. In short, financial independence means being self-reliant and providing for your own family and your own needs. It’s a complex topic, of course, because throughout history, women are constantly taught to be homebodies, caregivers, and homemakers, while men are taught to be career-oriented and providers for the household.

Nowadays, though, the tables are turning. Women are increasingly being taught about formerly taboo topics like investing, the stock market, balancing the budget, and career success, among other topics. Parents are encouraging their daughters to aim big and reach for the stars. Today, women continue to outnumber men when it comes to college enrollment and graduation rates.

One of the next steps? Teaching women to be financially independent. You’re never too old to learn about financial independence. If you’re married or recently divorced, and working to build (or rebuild!) your finances… that’s as good of a time as any to learn about financial independence. We’re here to help! 

Below, we’ll outline some tips for women looking to start their journey towards financial independence.

A Step-by-Step Guide to Financial Independence

Whether you are just starting your journey to financial independence or need a quick refresher, here’s our complete guide to achieving financial independence in your married life.

Get honest with your spouse

When is the last time you got serious and talked about money with your partner? Money arguments and disagreements are one of the leading causes of divorce for couples. Many people find it difficult to sit down and discuss finances with their partners. It can be awkward, embarrassing, or just downright strange if you’ve never done it before.

You may find it uncomfortable to be questioned about why you spend money a certain way. After all, how many times have you – as a woman – been told it’s rude to talk about money?

That’s exactly why it is so important to get honest with your partner about money. Approaching the topic of financial independence can be tricky, too. There’s a chance that your partner might not understand the reasoning, until you explain the concept.

Talking about money can – and probably will – feel awkward at first, especially if you earn different salaries. But the alternative is worse: resentment, disagreements, and other troubles. It’s important to talk about your financial background and experiences as well as your spending, too.

Consider asking the following questions to dig deeper: 

• How were you taught about money?
• What was your parent’s relationship to money like?
• What was your first job like?
• What do you consider priorities when spending money?

Learning more about your partner’s background with money can help you better understand the reasoning behind their financial decisions and what matters most to them. It means that if any potential problems arise down the line, you have better context to understand – and you can act with more empathy.

Of course, all of this considered, don’t neglect the specifics. You want to address tricky questions, too, like credit score, any debt, savings, and salary.

Make Joint Goals

Having the money discussion with your partner includes talking about your financial goals. Joint financial goals are key to living a happy life together. Do you both want to buy a house before you turn 40? Do you plan to retire by a certain age? Is a big trip to Europe your next immediate saving goal?

Big or small, your savings goals make a big difference in how you spend – and save – money as a couple. This is especially important  because you won’t be pooling all of your money together. Just like you have a joint bank account for expenses, you may need a joint savings account.

Planning how you can both contribute to the savings account is an important part of the process, too. For example: will you opt to split 50/50, or take into consideration the discrepancies between income and go the way of “you contribute what you can contribute”? It’s entirely up to you two.

Consider a Prenup

Some couples with assets will opt for a prenuptial agreement. Prenups often come off sounding cold and calculated, with one person in the relationship already thinking ahead to divorce, but the truth is that these agreements can be a good fit for some couples – and not for others. It’s totally up to you both and your relationship.

Financially independent women may like the idea of a prenup because it can mitigate risk in the future. For example, a prenup can protect your future children and grandchildren and their financial and inheritance rights. It’s also possible to do so with children from previous marriages.

Here are some other benefits to a prenup:

• A prenup can protect your business so that if your marriage does end in divorce, the business is not subject to joint control. This can be great for financially independent women who work hard to run their own business.
• A prenup can protect you from inheriting your partner’s debt. Some examples include student loans, mortgages, credit card debt, etc.
• If you’re getting married later in life and come into the relationship with significant assets, a prenup agreement can help prohibit unfair allocations of wealth to your spouse in case you do get divorced.

However, despite all of this, be aware that a judge can throw out a prenup if they find it unfair or invalid. The truth is that the validity of a prenup is never guaranteed. If the document is too one-sided, for example, the prenup can be thrown out easily.

Open your own separate bank account

Getting married doesn’t have to mean handing everything over to your partner. Many couples have a joint account for shared expenses, of course. But there’s a really good reason to keep your own separate bank account as a married woman.

“You should have your own account, both of you,” bestselling author of “Smart Women Finish Rich” and co-founder of AE Wealth Management, David Bach, tells CNBC. “It’s absolutely critical, especially for women, that you keep money in an account that’s yours that you control.”

The divorce rate has slowly been going down since it hit a peak 35 years ago – that’s where the “almost half of all marriages end in divorce” statistic comes from. But even as younger people get smarter about divorce, one fact remains true: women are often hurt the most, financially, during divorce. That’s why it’s so important to maintain your own financial identity.

“I want you having your own investment account, I want you having your own emergency account, I want you having your own credit score,” Bach says.

“Shark Tank” star Kevin O’Leary offers similar advice. “The reason you want your own account, and particularly your own credit card, is if you pay it off every month — that’s the first way you start to build a credit score. That makes things cheaper for you later in life,” O’Leary says.

Have a joint account, of course, for monthly shared expenses. But never merge all your assets into your joint account.

Keep track of monthly expenses

Understanding your own cash flow can give you a better understanding of where your money goes each month. This is an especially important concept for people who tend to say, “Where does my money go each month?”

Keeping track of your monthly expenses has many benefits, including:

• Understanding your breakdown of essential spending (bills, rent, etc.) to non-essential spending, like nice dinners or trips to the movie theater.
• Getting a bird’s eye view of your unexpected spending.
• Understanding where you can save money and cut expenses – and where you can’t.

If this entire concept of tracking spending seems messy to you, why not try free online budget tools? Mint Intuit has a great free tool, but be sure to also check out YNAB (which stands for You Need a Budget), EveryDollar, PocketGuard, and GoodBudget, which all come highly recommended.

Contribute to your retirement regularly

There’s nothing more important than securing your future, especially if financial independence is your ultimate goal. Ideally, you will have started to contribute to your retirement in your 20s, when you first start earning money and taking home paychecks. The sooner you begin saving, the more time your money has to grow.

Getting married means revamping your retirement efforts. You need your own individual retirement accounts, as with your own checking accounts, and you need to contribute to them regularly.

Have regular conversations about your finances

Just because you’ve sat down to talk about finances once doesn’t mean you shouldn’t do it again. Having regular check-in conversations with your partner can reduce financial conflict and make everything flow just a little smoother.

These conversations don’t have to be boring or tense, either. Make it a whole night: pour some wine, set out snacks, and go through your spreadsheets, notes, or whatever materials you have ready together. Regular check-ins mean not only understanding how everything is going, but redefining priorities, handling any unexpected expenses, or setting aside for savings if it works out. With regular check-ins you, and your partner, remain in the loop.

Avoid high interest loans

Credit cards have many benefits for their users (points! miles!) – but they can also wreak havoc on your personal and financial life. Credit card debt is expensive, and because you can keep spending money even when you owe money, your debt can multiply – fast. According to one recent NerdWallet study, US households with revolving credit card debt pay an average of $1,000 in interest each year. That’s a LOT of money!

Of course, there are times when credit cards can be useful: renting cars, for example, or unexpected expenses while you’re out of work. In those cases, it’s crucial to take steps to reduce your interest to help you save money. You can do this with balance transfers, tap into your savings, or even make multiple credit card payments each month.

At the end of the day, though, the best way to save money on a credit card, and credit card interest, is to avoid using them unless you have a plan in place to pay them back.

Share property ownership

Not sharing property ownership is a common mistake many women make on their way to financial independence. When couples buy property, they often put the property under one person’s name. This makes divorce messy and expensive. When you buy a piece of property, ensure the property is under both your names.  Owning property with a spouse through tenancy by the entirety can also provide you with protections not available with other types of property ownership.

Build multiple income streams

When you’re looking into how to be financially independent, it’s important to consider multiple income streams. Multiple income streams are one of the best ways to build long-term wealth. If you, like most people, have one primary source of income, having at least one other income stream will mean more stability.

For example: what happens if you lose your job? During the pandemic, thousands of people lost their jobs and their primary sources of income. That’s why it is so important to have multiple streams of income. That way if one income stream dries up, you can fall back on another thread.

Richard Corley, author of “Rich Habits: The Daily Success Habits of Wealthy Individuals,” has analyzed IRS data and found that 75% of millionaires have more than one income stream.

There are plenty of ways to build multiple income streams:

• Dividend income, from stocks
• Rental income, income earned from renting out your property
• Earned income from side hustles and other jobs
• Royalties from books and other professional work
• Business income, from running a business
• Interest income, from savings accounts, bonds, and more

Think about what income streams might work for you and consider adding another extra stream of income to support your financial independence.

Speak with a financial planner

Does the whole idea of financial independence as a woman seem daunting to you? It’s okay – you’re not alone. Sometimes, speaking to a financial planner can help make the whole process a lot simpler, especially if your goal is to be a financially independent woman. If you want to feel confident about your financial life, don’t hesitate to get in touch. 

Key Takeaways: Financial Independence for Women

Being financially independent means taking extra steps to secure your financial future when married. As a married woman, it’s important to work with your partner and keep each other informed and make time for important financial conversations.

At first, it may seem daunting to set up your own investments and your own bank accounts, but being brave and taking this first step can lead to a long-term financial success. Being honest is one of the most important pillars to financial independence in your marriage.