Five things women in their 40s need to know about money 

Rebecca Goodman
Insurance expert
4
minute read
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Posted 23 February 2022

Women in their 40s are often in senior positions in their careers, may have a household full of dependent children, and are around 20 years away from retiring. 

This means they could be better off than they have been at any point so far, with more disposable income for things like holidays, luxuries or just putting that money away for the future. 

However, if you’re in your 40s with debts to pay - as many are - this could be a good time to focus on paying them off, and even overpaying on your mortgage if you have the resources. 

It’s also a good time to reassess your financial situation so you’re as prepared as possible for the things we generally like to avoid thinking about, including death and divorce. 

Here we look at five financial areas to focus on while you’re in your 40s. 

Overpay your mortgage and save thousands in interest 

Depending on your financial situation, overpaying your mortgage could be on the cards in your 40s. 

This could bring you closer to becoming completely debt free and you could also save a lot in interest fees if you’re able to clear your mortgage sooner. 

If you’ve come into a windfall, such as an inheritance payment, this could be used. However, before you hand over the cash, check your mortgage documents. 

There may be fees for overpaying or a limit on the amount you can overpay without being charged a penalty. 

Review your savings accounts 

Saving for retirement, your next holiday or just a rainy day? 

There’s no point letting that money linger in an account where it’s earning next to nothing. Interest rates may be dire but there’s still time to take advantage of the 2021/2022 tax year, and your ISA allowance of £20,000. 

This runs out as soon as the new tax year begins on April 5, so if you’ve got money to move, it’s worth finding an ISA with the highest rate of interest available and transferring it (while following the ISA rules on transferring so you take advantage of the tax-free status). 

Find out more about tax-free savings accounts here  and compare rates based on your savings goals. 

Women in particular are more likely to worry about not being able to pay bills 

Slash your household spending 

The cost of everything from energy bills to food is rising and, if you have a full house (with kids and/or elderly relatives at home) the price is really going to add up. 

Women in particular are more likely to worry about not being able to pay bills - 28% of women said they often worry about not having the money to pay, compared to 20% of men, according to research from Hargreaves Lansdown. 

So carve some time out of your month to look at your household spending. 

There are  loads of ways  to cut down on spending, and many of these can make a big difference. 

Switching to own brand foods, meal planning and taking advantage of apps such as OLIO and Too Good To Go can reduce your food shopping. 

It’s also worth reviewing all your utility contracts on Compare the Market to check you’re getting the best deal possible. 

If not, feel free to haggle - you can ask a provider to lower its costs at any time, especially if it’s charging new customers less than you’re paying - and if you’re not happy you can always switch to a new provider. 

You can sell your empty candle jars and perfume bottles on eBay for as much as £33 a pop. 

Make extra money from your home 

There’s a few ways in which to make some extra cash from your home - and this could come in handy if you’ve got a family to support, you want to put some extra money aside for your future, or you’ve got debts you want to clear. 

One way is by renting a room out in your house. You can do this on a full-time basis, during the working week or as a one-off, depending on how often you’d like someone else in your house. 

A quick look at a website such as Airbnb or Spareroom can show you the average prices for your area. 

And you’re able to earn up to £7,500 a year without paying any tax, thanks to the government’s Rent a Room scheme, as long as you’re eligible. 

Or why not turn your trash into treasure with our handy guide to selling bits that you would otherwise throw in the rubbish. 

Believe it or not, you can sell your empty candle jars and perfume bottles on eBay for as much as £33 a pop. 

There are important financial steps to take during and after a divorce 

Rebuild your life after divorce 

It’s not something anyone wants to talk (or think) about but, sadly, it’s a fact of life. 

In 2020 alone there were 103,592 divorces granted in England and Wales according to data from the Office for National Statistics (ONS). 

There are important financial steps to take during and after a divorce, or any long-term relationship breakdown. 

These include rebuilding your savings, especially if you’ve had to pay out a lot in legal fees which may have drained your finances. 

Your will and any protection policies, such as life insurance, will also need to be reviewed and potentially re-written. 

If you’ve got a joint life insurance policy, for example, you might want to end this and take out your own single policy and change any beneficiaries you’ve named on it. 

Divorce means you will need to write a new will - you can do this online or if you have a more complicated situation you may want to pay for legal advice when setting it up. 

Find out how to get a fair deal for everyone when getting divorced here.

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Don’t forget that while you may think that this article is brilliant, it is intended for information purposes only and should not be mistaken for financial advice or recommendations.