Raise your hand if your finances stress you out. If your hand’s not up right now, good for you. If it is, welcome to the club. That’s why we sat down with First Commerce Bank’s Jill Ross to chat about tips for women to find financial freedom. 

What is financial freedom?

Financial freedom, says Ross, is when you’re able to stop living paycheck to paycheck. That means you have the freedom to direct your cash flow in the way you want instead of having to spend your money on expenses and have little to nothing left over each pay cycle.

But having a bigger paycheck isn’t the only way to reach financial freedom – and just because you have a larger income doesn’t mean you’re guaranteed to have that freedom either.

So Ross shared some tips to help women achieve financial freedom. 

Understand your financial picture

The first step to finding financial freedom is understanding where your money has to go each month. They’re called fixed expenses, says Ross. “You want to understand what you need to be stable for those fixed expenses, and then what spending you can be flexible with,” she says.  

By knowing what expenses you have to cover each month, you’re setting yourself up to budget better. And that means being at less of a risk to spend money you don’t have.  

For women in a relationship, who share expenses, this means it’s important to have a conversation with your partner about those expenses. If one person handles all the bills, and if that isn’t you, you’ll want to have that conversation sooner rather than later so you can understand where your money is going each month. 

“Not knowing the financial picture of your household can put you in a position of not being an equal decision maker in the household,” Ross says. “But it can also make it really difficult to transition out of the relationship if something happens.”  

Know your comfort level

Jill Ross- First Commerce Bank

Are you the type of person who needs 6 months of expenses saved in your account at all times? Are you comfortable with 3? Are you going through life with little to no savings and feel fine? 

Ross won’t tell you there’s a right or wrong way of approaching these situations when it comes to savings – she even reminds her customers that you can’t take your money with you when you die. But she does say it’s important to know your comfort level, and to find a balance in your splurging.  

“Part of finding financial freedom is knowing how to interpret your financial picture,” Ross says. “Knowing your comfort level will help you set your budget. But of course, if you have someone who’s struggling financially and they’re going to the same concert three times a year, that’s where you’ll want to ask, ‘Do we really need that?’” 

Learn to handle inflation

While you don’t need a big paycheck to find financial freedom, that doesn’t mean you should blindly accept what you’re getting paid. Especially now that we’re experiencing inflation, says Ross. 

“You have to ask for raises to outpace inflation,” she says. “If someone gives you a raise that’s less than inflation, then you’re not making enough. And it’s about being transparent with your employer.” 

Use your credit cards the right way

Think of your credit score as a financial report card. It’s what banks use to decide how much they’ll lend to you. So the better your rating, the more you can borrow – which means the more freedom you can have with your money down the line. 

But there are risks to using credit cards as well, says Ross. So it’s important to keep a few things in mind. 

First, always pay off your balance each month – not just the minimum balance – if you can. Because that interest will sneak up on you. “Some people will put a pizza on their card and it’ll end up costing like $250 because they haven’t paid it off and the interest keeps building,” Ross says. 

But if you’re nervous about using credit cards, ignoring them completely isn’t the answer, because then you aren’t building that financial report card. It’s about using them the smart way. For Ross, she has different cards for different types of rewards – and uses them for payments she’ll be able to pay off at the end of the month.  

“Not everyone grew up with credit cards, and so they have to learn it later,” she says. “What people don’t always talk about is leveraging the reward benefits of credit cards as long as you can manage it. I have one card for hotel rewards, one for airline rewards and one for cashback rewards.”