For many years now, women have been contributing immensely in every sphere. In fact, according to the World Bank, women make up around 20%* of the total workforce in India. However, despite this women often take a back seat in managing finances or taking financial decisions. Most women across the world would not take a financial decision without consulting a male member of their family, such as a husband or a father.
As smart women of today, every woman needs to start paying attention to managing her finances. The key to this change lies in a change in mind-set. This doesn’t mean that a woman should not consult while taking financial decisions, but instead must work toward gaining financial literacy.
Therefore, we present some tips for the smart woman so she is better capable of managing finances on her own-
Save! Save and Save More!
Whether married or unmarried, a stay-at-home mother or working, it is important to have a fair amount of savings each month. Having an amount of money saved up gives a great deal of self-confidence and peace of mind. It can come in handy in case you or a member of a family has any medical emergency.
Now we don’t suggest that you aggressively bargain with the vegetable vendors or wait for that “Big Sale” to hit your favourite store. But what you can do is that every time you buy something or spot something on the online shopping app, stop a minute to think about whether you really need it. Chances are that you really don’t or if it’s really necessary, you will find a cheaper option for it.
Part of being an independent woman also means being able to buy something that you really want or to take charge when a financial crisis hits the family.
Learn to Earn
Today, there are several routes for a woman to earn. In fact, women are better able to find jobs and earning prospects where they can unleash their creativity or express themselves. Work from home, Freelancing, Online Selling, Tuition Classes or Fitness Coaches, there are a host of options for women to explore if she does not want to tread the corporate path.
The amount you earn is irrespective. At the beginning, it might not even be much. But do not give up! You will watch your income steadily rise in due course of time. You can add the money you earn to your savings.
Prepare in Advance!
Women go through several phases in life that are completely life-altering. This is one of the biggest reasons women find it difficult to plan long-term.
Having said that, it is still important to save for certain events that one anticipates in the near future, for example, marriage or childbirth.
●Marriage: In India, usually parents pay for this major life event. But it is always wise if you can contribute to this mega-event of your life. Therefore, while managing finances, ensure to keep a fixed amount saved aside for such major life events.
●Childbirth: According to the CII, 36% of women take a break from work after childbirth.** While there is nothing wrong in taking a break from work, quitting your job or switching careers, good financial planning will ensure that you do not depend on anyone for all your needs. Let your child or your parents see you buy something for them once in a while.
●Health Complications: Women today also go through several health-related complications. According to the American Thyroid Association, one in eight women develop thyroid during her lifetime.*** The rates of PCOD and Diabetes are on the rise. Therefore, one must have enough savings to manage such unforeseen health issues. Women above 60 should ensure that they do not always look to their sons or their daughters for their sustenance.
●Divorce: In the unfortunate circumstance where you see yourself unable to carry on in a marriage, financial independence will give you the much- required confidence to walk out of a failed marriage. Most women stay on in such marriages as they have no other means of sustenance.
Planning for every type of situation financially will give you the freedom to live confidently.
Once you have a decent amount of savings, you can decide to invest some amount. This cycle of Save and Invest goes a long way in building your financial health. While managing finances, ensure that you take the time to ask around and gather information on good financial plans to help grow your money.
Financial investment options such as Mutual Funds allow you to save even a small amount. Some even offer different schemes for women with higher interest rates and tax benefits. Therefore, one must definitely choose an option that is best suited to one’s needs and financial goals.
The woman of today is bold, expresses herself, and loves to indulge once in a while. It is about time that she changes her outlook towards money too. Managing finances and aiming for greater wealth are a crucial part of women’s independence and requires a great deal of attention.
This Women’s Day let us pledge to empower ourselves by becoming financially literate and taking control of our future, financially!
An Investor education and Awareness initiative of Aditya Birla Sun Life Mutual Fund
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