Saudi women have made great strides in entering the labor market and participating in the economic growth of the kingdom. Saudi Arabia’s economy has witnessed remarkable growth recently, which is in turn reflected in women’s increased participation in the local economy.
The ratio of women workers to the total population increased in the fourth quarter of 2022 to 30.4 percent. This is a significant increase from 27.6 percent in the fourth quarter of 2021.
Meanwhile, their participation in the labor market reached 36 percent, compared to 35.6 percent in the fourth quarter of 2021.
Women’s unemployment also decreased in the fourth quarter of 2022 to 15.4 percent compared to the previous three years according to the General Authority for Statistics report.
Women’s employment rates and increased income
In her interview with the Saudi Press Agency on World Savings Day, Mead Abdullah Al-Bassami, financial trainer at the Institute of Public Administration, emphasized that “financial awareness of women has considerably evolved, especially since they have proven their worth in the commercial market.”
She explained that the statistics reflect the high income of working women, which is a positive consequence of their employment and increasing income. This development has emerged in light of the government’s initiatives to empower women and provide diverse job opportunities. This allows women to achieve the highest levels of income and financial independence.
Al-Bassami stated that “women planning their budget requires setting financial goals and precisely defining financial priorities. Important and urgent priorities include fixed and monthly expenses such as electricity and water bills. Important but non-urgent priorities include annual fixed expenses such as house rent, car insurance, and school tuition.”
How Saudi women budget
Al-Bassami proposed using mobile apps that track expenses and organize budgets effectively. She also highlighted the importance of using banking apps to help manage and regularly track finances, even investments. In addition, she touched on effective methods for managing personal budgets.
Al-Bassami suggested the 80-20 percent rule, where 20 percent of income goes to savings or investments. This will help women create financial reserves and achieve future goals or manage financial emergencies.
On the other hand, in the case of debt, Al-Bassami recommended that 20 percent should be allocated to repay the liability. Debt payments can be made in installments, for personal or real estate loans, or credit cards. For Al-Bassami, debt should not exceed 20 percent of monthly income to achieve financial stability.
Meanwhile, 80 percent of the income should be directed to covering basic expenses such as rent and bills. The proportions of this rule may change based on special circumstances and financial priorities.
Read: Women at the forefront: Saudi’s pursuit of gender equality
Savings and investments
When it comes to savings and investments, Al-Bassami believes that they are the most important tools to manage inflation. They are needed to ensure a stable financial future. Long-term investments and savings ensure financial freedom in the long run, especially after retirement or for creating a private business.
Moreover, investments help in developing financial resources. It preserves the value of actual money in light of inflation. She also shed light on the importance of diversifying investments to ensure good returns in the future.
Furthermore, Al-Bassami drew attention to the fact that technological advancements have contributed to finding innovative ways to save and invest. All individuals, even those with low income, such as students, can benefit from investments, and savings using the right financial technology or platform.
Debt and loan management
Debt and loan management plays a decisive role in achieving financial freedom. Women are able to manage their financial obligations effectively. Therefore, it is necessary to develop a regular and solid repayment plan that includes allocating a monthly amount for that. The success of any repayment plan depends on a person’s extent of commitment to it. Additionally, it is crucial to constantly re-evaluate expenses, especially personal expenses, and limit them to necessary expenses.
However, debt management should not stop individuals from seeking financial independence. Rather, it is necessary to allocate an amount for saving and investing periodically, provided that investment is diversified and goal-oriented. Regularly reviewing and updating debt management strategies is crucial depending on circumstances and financial objectives.
Improving financial skills of Saudi women
When asked about increasing women’s financial skills, Al-Bassami stressed the importance of reading and continuous learning. Books, articles, blogs, and podcasts are powerful tools that increase financial awareness and inform women of the latest money-management methods.
She emphasized the importance of utilizing sources like financial newsletters, podcasts, courses, and seminars related to money development and management. Such resources facilitate direct communication with specialists in the field. Additionally, joining social media groups interested in finance and investments enables the exchange of ideas and experiences. Through Telegram and other platforms, women can learn from other’s experiences.
For more banking and finance stories, click here.
