How to rebuild financial confidence after time out of the workforce

In the five years to December 2024, Australian women’s workforce participation soared by 1.8 percentage points to 63 per cent – more than double the 0.8 percentage point growth in men’s participation (which still leads at 71.2 per cent).

However, this overlooks important factors about women’s experiences of the world of work. Women dominate:

• part-time and casual jobs, which tend to be less secure
• lower-paid industries
• unpaid domestic work
• career gaps.

Sometimes they leave paid work is by choice (extended travel), while other times it’s forced (redundancy, illness). Predominantly, it’s for family reasons: raising children and/or caring for elderly parents.

Regardless, the impacts are the same: less income, less superannuation, and changed job requirements when they do return. No wonder you may feel a confidence hit.

But fear not! Use these tips to rebuild your confidence better than ever.

Choose jobs carefully

The temptation, especially after extended time off work, can be to just accept any job. However, doing so may devalue your professional and personal worth. Consider:

• Your previous work experience
• Current skillset
• Future professional goals
• Personal values and interests
• Family needs
• Long-term demand for particular jobs.

These will help you align your new role with family commitments, job satisfaction, and longer term progression and income prospects.

Leverage your unique experience

Chances are you learned some serious life skills during your career break. Parenting young children? Nobody understands hard work and multitasking better. Caring for a sick or elderly relative? A+ personal care and empathy skills. Successful cancer treatment? Resilience expert.

These skills are not only transferrable to the workforce but often highly desired by employers. Be proud of them and use them to your advantage.

Get job ready

Don’t let doubts about your abilities sap your confidence and deter you from getting back into paid work. Depending on your industry and time out of the workforce, consider:

• short courses to refresh basic skills and knowledge
• more detailed qualifications or training to overcome any major gaps or transition into a new area
• free webinars and tutorials for relevant tools (think Microsoft Office, Canva, WordPress, social media etc.)

Also research the current state of your desired industry – how have things changed since you left? What are the current pay rates?

Weigh up childcare options

For many women, returning to work demands finding alternative childcare arrangements. Scrutinise the numbers carefully and explore different options before committing to anything, including:

• childcare (and government subsidies)
• an au pair or nanny (who may also do additional jobs around the house)
• grandparents or other relatives
• shared babysitting with other local families.

Many parents find the cost of childcare versus their hourly pay rate and commute time to be uneconomical. But look at the big picture too and whether this could be a short-term sacrifice for longer term income gains.

Avoid dressing beyond your means

New outfit = new confidence, right? Not always!

Pushing yourself into debt to pay for new workwear will has the opposite effect. Avoid racking up credit cards or Buy Now Pay Later debts.

Refreshing your existing wardrobe with new accessories or shoes is cheaper than a whole new outfit or check out second-hand shops and online marketplaces.

Update your finances

Once you resume working, update your financial foundations accordingly:

• Emergency fund: Your emergency fund may need some attention now you’re earning again.
• Spending and invest plan: Include your new income, work-related costs, new opportunities to build wealth, and changes to any tax or Centrelink benefits.
• Insurances: Ensure your cover reflects your new situation (e.g. do you need professional indemnity cover? Income protection? Is your household cover sufficient given your home may now be empty during the day?)
• Superannuation: Don’t consolidate into a new fund without comparing fees, returns and any existing insurances; consider using catch-up rules to recover the shortfall while you weren’t working
• Estate planning: Reflect your additional income and changed lifestyle.

If you’ve been living comfortably on just one income, resist the temptation to splurge and use that second income wisely, such as paying off debts, increasing mortgage repayments or investing.

Don’t do it alone

Countless women have faced the same situation, so there’s no need to go through this on your own. Friends, neighbours, and mothers groups allow you to support one another through shared experiences.

Your referees – past employment, voluntary work, your child’s school if you volunteered for canteen duties, or the parent and citizens committee – can offer encouragement and help you identify examples to highlight in job applications and interviews.

Professionals provide tailored, impartial advice: recruiters on your job hunting approach, coaches on your mindset and soft skills, and financial advisers on your protecting your monetary wellbeing. Combined, this is a powerful support team in your camp.

Disclaimer: The information in this article is of a general nature only and does not constitute personal financial or product advice. Any opinions or views expressed are those of the authors and do not represent those of people, institutions or organisations the owner may be associated with in a professional or personal capacity unless explicitly stated. Helen Baker is an authorised representative of BPW Partners Pty Ltd AFSL 548754.