Let’s Find Out How Can We Be Aware of Our Financial Independence As Women

With more and more women becoming financially independent every day, they are becoming conscious about what to do with their money. Now, if financial independence is the first step, the final goal is?financial freedom. Even though the intentions are right, due to lack of vision, most of them get stuck somewhere in the middle.

A woman who has a regular income should allocate her finances in a 50-30-20 ratio. About 50 percent of the money should be spent on basic necessities and home expenses. About 30 percent should go toward self-care and leisure activities. And, 20 percent of your income should be invested. These numbers, however, might vary as per your priorities.

Here are a few ways a woman can walk her way through?financial independence?towards financial freedom, but only with the right approach towards their money goals and investments.

Women have been managing household finances for the longest time. She has always taken the call on how much to spend on necessities and how much splurge. Also, within that limited amount, she has managed to save. By nature, women are pro at budgeting. So, start with it – something that you know best.

It is the money that you keep aside in case of an emergency or uncertain events. As per the general rule, the fund should be equal to three to six months of our expenses, but for a woman, the size of this fund should be much bigger. This is simply because women tend to take long sabbaticals. Being a part of the sandwich generation, this is a hard reality. To take care of the elderly parents/ in-laws or young children, women often have to opt for long sabbaticals, sometimes even for a few years.

1. File manually

You can download the forms you’ll need to fill out from the IRS website. It is completely free to download these forms. If you choose to print them, you can complete them by hand and mail them in.

In most cases, this manual method for?doing your taxes?is only a good option if you have a fairly simple tax situation. Although you can work through a more complex financial picture with these paper forms, it might become tedious after a few forms.

2. File your taxes with the IRS online fillable forms

The?IRS?offers free file fillable forms on their e-File site. With the fillable forms, you’ll have line-by-line instructions to help you complete the form. If this is your first time filing your own taxes, then the instructions can be helpful to follow.

3. Using an online tax software program

As a final option, you can use online tax software programs to file your own taxes. Although you may need to pay to use an online software program, it might be worth it if you have a complex tax situation.

Most tax software programs walk you through the filing process with prompts along the way. It can be helpful to see these prompts. You might see something that helps you notice easily forgettable details of your tax year.

A few good options include:

Credit Karma Tax:?In addition to their free credit monitoring, Credit Karma offers free tax filing via a simple and easy-to-use interface.

TurboTax: You can use TurboTax to file your basic return for free. However, you may need to upgrade to a paid version if you have a complicated situation.

H&R Block: H&R Block is another well-known tax software program that can help you file basic returns for free. However, their paid options are very affordable if you need more help.

Simply choose the software that you are most comfortable working with. Doing your own taxes will be much easier if you pick a method that feels easy to you.

4. Which filing option should I choose to do my own taxes?

Each of these options is a completely acceptable way to file. There is no single option that is better than the other. The choice should come down to your personal preferences.

For example, if you are more comfortable working with pen and paper, then work by hand. But if you are comfortable with using your computer, then the online tax preparation software might be a better fit.

Either way, you’ll be able to file your taxes. Plus, you’ll determine whether you owe taxes to the government or if you’ll receive a tax refund. If you need to make a tax payment, then you can also mail your check to the IRS.

However, you can also complete this transaction with a credit card, debit card, or wire transfer. You can find details about these options in the IRS online payment system.

6. Should I do my own taxes?

Now that you know the steps you may still be contemplating "Should I do my own taxes?" To be honest, the process of taking care of your own taxes is not for everyone. Let’s take a closer look to see if it is a good option for you.

When is it a good idea to do my own taxes?

Preparing your taxes?can be time-consuming and somewhat tedious, but it is completely possible to tackle this annual task on your own. You might be able to save some money, but you’ll also feel more in control of your finances.

If you choose to do your own taxes, then you’ll need to pay close attention to details along the way. It will likely take several hours to work through your forms, so make sure to set aside the right amount of time.

If you don’t want to spend time doing this or don’t have the time, keep things simple. Just invest in these three mutual fund categories –

Get Yourself Insured:?In the midst of juggling work and home, women often forget to take care of themselves. And when we say care, we specifically mean health and finance.?The first step towards protecting yourself in these two aspects would be to get insurance.?

The reasons for which health insurance becomes the top-most priority is the fact that women are prone to several life-threatening diseases like cancer, chronic health conditions like arthritis, and also other reproductive issues.?Health insurance companies acknowledge this, and most of them have devised women-specific critical illness policies to provide financial aid before these diseases turn critical. This is the utmost essentiality irrespective of the fact whether you are working or not.

Today, the role of a woman is not typically restricted to a homemaker; she has equal financial responsibilities like her brother and her husband. This is exactly why a working woman should also get herself term insurance. It will ensure that they have enough life cover to safeguard their financial dependents against any eventualities of life. It is always advisable to purchase term life cover at an early age as the premium increases if bought later.

Filing your?taxes?yourself doesn’t have to be difficult. If you follow these?steps?and file via a user-friendly tax software, you can complete your returns quickly. But?doing taxes?alone on paper can be overwhelming, so get some extra help from?TaxAct.

Let a?good tax plan?give wings to your greatest returns !

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Author: Priyanga S

Image courtesy: Unsplash.com