You're young free and single, and your 20's are your playground, but they're also a decade in your life that will count a whole lot towards your future. While financial planning may seem boring and unnecessary, the smart, savvy you will recognise the need to plan for a future that could be difficult and one where you may run into some bumps on the road. Here are five relatively easy moves you can make to make your financial future a more stable one.
Write Down Your Goals
Without creating a list of long- and short-term goals, it is impossible to determine if you are making the right financial decisions. Consider things like: ;
How you envision your retirement;
If and when you'd like to become a homeowner;
Whether you plan to have children;
Which debts you want to focus on paying off first
Credit Cards are a necessary evil. Choose yours carefully and monitor your spending with mobile banking apps.
And remember, you don't need to map out your entire life. These goals will change and evolve over time, but thinking about where you want to be in 1, 5, 15 years can help you hone in on what kinds of financial decisions you should be making day-to-day.
Start Saving for Retirement
I know what you're thinking. “I'm only in my 20s, I can save for retirement later, right?" Technically, yes, but it is in your best interest to start now. The sooner you start, the less you'll have to save, because the effects of compound interest will have longer to mature. This means you can contribute less and end up with more than if you were to wait to start saving in your 30s. Check with your employer to see if they have a 401(k) plan that you can make automatic contributions to through your paycheck. If they offer a matching plan, this is essentially free money, so try to contribute enough to maximize the amount they'll match.
Stop Maxing Out Your Credit Cards
Young adults are often guilty of treating credit cards like free money. There is often a “charge now, worry about it later" mentality when it comes to credit card usage. Now is the time to stop. Not only is this hurting your credit score, but it's costing you a ton of money in interest. Your 20s should be a time when you start taking your finances more seriously and thinking long-term. You'll also likely be dealing with a whole new set of financial responsibilities such as rent, utilities, student loan payments, perhaps a car loan – and worrying about how you're going to pay off a high credit card balance is the last thing you need to be thinking about.
Rather than charging a vacation or nights out with friends to your credit card, take some time to create a budget and determine how much you can reasonably spend on your social life and other indulgences, while still being able to save and pay for necessities. A credit card should only be used when you know you can pay off the balance in full at the end of the month.
Take Control of Your Credit Score
Excellent credit takes years to build, so if you haven't started building a credit history, or if you haven't used your credit responsibly, now is the time to start taking charge. Your credit score is calculated based on the length of your credit history, your payment history, the amount of debt you owe, the amount of new credit accounts you have opened, and the types of credit accounts you have. You can check your credit reports and score with each of the 3 major bureaus (Experian, TransUnion, Equifax). It is in your best interest to ensure you are on the path to having a great credit score so that when the time comes to borrow money (such as when applying for a mortgage or a car loan) you'll be seen as an excellent candidate to lenders.
Create an Emergency Fund
Life is full of ups and down and unfortunately that sometimes means unexpected payments. Since funds and income are typically somewhat limited in your 20s, you don't want to suffer a major setback when an unexpected expense comes your way. Instead, open a separate savings account and designate it as your “emergency fund". Ideally, an emergency fund should cover 3-6 months' worth of expenses. While it may take some time to build up, make this a priority so that you have it ready as your “secret weapon" when you need it.
Women of the Middle East have made significant strides in the past decade in a number of sectors, but huge gaps remain within the labor market, especially in leadership roles.
A huge number of institutions have researched and quantified trends of and obstacles to the full utilization of females in the marketplace. Gabriela Ramos, is the Chief-of-Staff to The Organization for Economic Co-operation and Development (OECD), an alliance of thirty-six governments seeking to improve economic growth and world trade. The OECD reports that increasing participation in the women's labor force could easily result in a $12 trillion jump in the global GDP by the year 2025.
To realize the possibilities, attention needs to be directed toward the most significantly underutilized resource: the women of MENA—the Middle East and North African countries. Educating the men of MENA on the importance of women working and holding leadership roles will improve the economies of those nations and lead to both national and global rewards, such as dissolving cultural stereotypes.
The OECD reports that increasing participation in the women's labor force could easily result in a $12 trillion jump in the global GDP by the year 2025.
In order to put this issue in perspective, the MENA region has the second highest unemployment rate in the world. According to the World Bank, more women than men go to universities, but for many in this region the journey ends with a degree. After graduating, women tend to stay at home due to social and cultural pressures. In 2017, the OECD estimated that unemployment among women is costing some $575 billion annually.
Forbes and Arabian Business have each published lists of the 100 most powerful Arab businesswomen, yet most female entrepreneurs in the Middle East run family businesses. When it comes to managerial positions, the MENA region ranks last with only 13 percent women among the total number of CEOs according to the Swiss-based International Labor Organization (ILO.org publication "Women Business Management – Gaining Momentum in the Middle East and Africa.")
The lopsided tendency that keeps women in family business—remaining tethered to the home even if they are prepared and capable of moving "into the world"—is noted in a report prepared by OECD. The survey provides factual support for the intuitive concern of cultural and political imbalance impeding the progression of women into the workplace who are otherwise fully capable. The nations of Algeria, Tunisia, Morocco, Libya, Jordan and Egypt all prohibit gender discrimination and legislate equal pay for men and women, but the progressive-sounding checklist of their rights fails to impact on "hiring, wages or women's labor force participation." In fact, the report continues, "Women in the six countries receive inferior wages for equal work… and in the private sector women rarely hold management positions or sit on the boards of companies."
This is more than a feminist mantra; MENA's males must learn that they, too, will benefit from accelerating the entry of women into the workforce on all levels. Some projections of value lost because women are unable to work; or conversely the amount of potential revenue are significant.
Elissa Freiha, founder of Womena, the leading empowerment platform in the Middle East, emphasizes the financial benefit of having women in high positions when communicating with men's groups. From a business perspective it has been proven through the market Index provider MSCI.com that companies with more women on their boards deliver 36% better equity than those lacking board diversity.
She challenges companies with the knowledge that, "From a business level, you can have a potential of 63% by incorporating the female perspective on the executive team and the boards of companies."
Freiha agrees that educating MENA's men will turn the tide. "It is difficult to argue culturally that a woman can disconnect herself from the household and community." Her own father, a United Arab Emirates native of Lebanese descent, preferred she get a job in the government, but after one month she quit and went on to create Womena. The fact that this win-lose situation was supported by an open-minded father, further propelled Freiha to start her own business.
"From a business level, you can have a potential of 63% by incorporating the female perspective on the executive team and the boards of companies." - Elissa Frei
While not all men share the open-mindedness of Freiha's dad, a striking number of MENA's women have convincingly demonstrated that the talent pool is skilled, capable and all-around impressive. One such woman is the prominent Sheikha Lubna bint Khalid bin Sultan Al-Qasimi, who is currently serving as a cabinet minister in the United Arab Emirates and previously headed a successful IT strategy company.
Al-Qasimi exemplifies the potential for MENA women in leadership, but how can one example become a cultural norm? Marcello Bonatto, who runs Re: Coded, a program that teaches young people in Turkey, Iraq and Yemen to become technology leaders, believes that multigenerational education is the key. He believes in the importance of educating the parent along with their offspring, "particularly when it comes to women." Bonatto notes the number of conflict-affected youth who have succeeded through his program—a boot camp training in technology.
The United Nations Women alongside Promundo—a Brazil-based NGO that promotes gender-equality and non-violence—sponsored a study titled, "International Men and Gender Equality Survey of the Middle East and North Africa in 2017."
This study surveyed ten thousand men and women between the ages of 18 and 59 across both rural and urban areas in Egypt, Lebanon, Morocco and the Palestinian Authority. It reports that, "Men expected to control their wives' personal freedoms from what they wear to when the couple has sex." Additionally, a mere one-tenth to one-third of men reported having recently carried out a more conventionally "female task" in their home.
Although the MENA region is steeped in historical tribal culture, the current conflict of gender roles is at a crucial turning point. Masculine power structures still play a huge role in these countries, and despite this obstacle, women are on the rise. But without the support of their nations' men this will continue to be an uphill battle. And if change won't come from the culture, maybe it can come from money. By educating MENA's men about these issues, the estimated $27 trillion that women could bring to their economies might not be a dream. Women have been empowering themselves for years, but it's time for MENA's men to empower its women.