No matter how much headway women have made in closing the financial disparity gaps with men, the reality is that we still have a long way to go. We know that, unfortunately, barriers for women remain, whether it is pay inequity or the fact that our retirement savings are, on average, significantly lower than those of our male counterparts even though we are likely to live longer. Financial planning has a huge impact on the quality of our lives, making it imperative that women are informed, educated, and involved in our finances. It is important to know that you can protect yourself and ensure you are financially secure going forward by practicing the seven following steps:

1. 1. Be Involved with Your Finances and Establish a Financial Identity
   The more actively involved you are with your finances and the more intimately you are familiar with them, the better. This means that you should make a habit of knowing exactly how much money you have coming in and going out and that you track this on a regular basis. You need to be familiar with your spending habits, who your creditors are, and what your bank and savings account balances are, amongst others.

   If you haven't already, you need to establish a financial identity of your own, which means that you have bank accounts and credit cards in your name, for example. This doesn’t necessarily mean that you should not have any joint accounts. Instead, ensure your name is on joint accounts and, ideally, you should have accounts in your own name as well. Building a financial record and starting to establish your own credit rating is vital if your financial circumstances unexpectedly change because most women will end up managing assets on their own at some point during their lifetime.
   
   

2. 2. Save Save Save!!!
   Every person, male or female, should have extra money in the bank for life’s unexpected expenses. Often called emergency accounts, these funds can both provide you with a safety net as well as help you get through challenging times. Most experts recommend you save three to six months’ worth of living expenses, but you should ultimately save what you can with what you have.

   Not only can emergency savings help you pay your expenses if you lose your job but keeping cash can also help you stay out of credit card debt. And remember, the sooner you start saving, the better because your money has more time to grow. When it comes to saving, the best advice is to save early and save as often as you can.
   
   

3. 3. Plan for the Future
   Planning for your future is one of the biggest steps toward ensuring you are financially secure. This includes both emergency and other savings as well as saving for your retirement years. In India, women live, on average, more than 3 years longer than men. This means that you should maximize your retirement contributions. If you haven’t already, check with your employer to see if they have any employee retirement plans in which they contribute some or all of your annual contribution limit. These plans are a simple, convenient and easy way to increase your retirement savings.
   If you can’t afford to maximize your retirement contributions, you may wish to consider a retirement loan but only borrow as much as you know you’ll be able to pay back within a short period of time. In addition to planning how certain events may impact your finances, like retirement or losing a spouse, for example, you may also wish to consider how others’ finances will be affected if something happens to you. One of the best ways to do this is to create an estate plan which designates your heirs and determines what will happen if you become incapacitated.

    

4. 4. Establish Goals to Ensure Your Financial Security
   Unfortunately, many Indian women don’t have a financial plan. In order to best manage your finances, you need to have clearly defined goals and a plan on how you will achieve them. You have to know what you are working towards, after all, whether it be to buy a house or car, send your children to university, pay off debt or save for retirement, for example. The more specific your goals are, the better.
   Some important short-term goals to consider are to create an emergency savings fund and to prioritize paying down high-interest debt, while longer-term financial goals might include saving for vacation or retirement. Whatever your goals are, put a timeline on them and start putting money aside regularly to achieve each goal. Don’t forget to track your progress and celebrate your wins, both big and small, as you achieve your goals.

    

5. 5. Build Your Credit Rating
   Having credit in your name is one of the most important steps you can take because it can be very difficult to feel financially secure if you don’t have access to credit. If you have little to no credit history, it can be very difficult to get credit if, and when, you need it, so the sooner you start creating a credit history, the better.
   The good news is that this is an easy enough issue to fix by becoming an authorized user on your spouse’s existing credit card account or by securing your own credit card. You don’t, in fact, need a credit card to build credit, although it is one of the best ways to do so. You can, indeed, establish a credit rating by paying your monthly utility or cell phone bills on time, for example. Once you build this history, you can typically qualify for credit cards, loans, and other financial products.

    

6. 6. Minimize High-Interest Debt
   Certain debt, like your mortgage, for example, isn’t necessarily bad to have, but there are other types of debt that you should focus on eliminating as quickly as possible if you have them, including high-interest credit cards, for example.
   Because most credit card companies charge daily interest, your balances can increase quickly the longer they go unpaid, and the interest rates are traditionally extremely high, thus making paying off your debt very difficult. Therefore, the sooner you pay off any credit card debt, the better, and any amount over the minimum payment helps. Many women don’t know that you can be an advocate with your own creditors. Indeed, creditors can sometimes help by providing interest rate reductions, for example.

    

7. 7. Save for Maternity Leave – and Beyond
   If you’re planning to have a child, it’s a smart idea to financially plan now for a potential leave from work because your finances can experience a short-term setback. In addition, the cost of raising a child is not insignificant, so you should map out the financial implications now so that you are better prepared for the future. This might include putting extra savings aside or starting a separate fund to save for your child’s education, for example.
   You might also want to check your employee benefits to see if your company offers any additional benefits for maternity leave. Ensure you familiarize yourself with the Indian Maternity Benefit Act as well, which stipulates that a working woman is entitled to 26 weeks of paid maternity leave for her first two children. For each subsequent child, you may take 12 weeks of leave which is fully paid for by your employer.

Women are often intimidated by financial decisions and planning but taking an active role in your financial life is extremely important for so many reasons. You need to know what’s happening in your own financial life and how what’s happening may impact your dreams and goals. Ensure that once your plan is in place, you don’t just establish and forget it but, instead, update it regularly. Always remember that knowledge is power so, too, is keeping on top of what’s going on in your financial life powerful. Monitoring is important but it can also be exciting to see the progress you have made towards an important goal!

Although women have numerous financial inequalities compared to men, like the fact that we earn less and are less likely to invest to build our wealth, the good news is that we are, actually, much better positioned for financial independence than we may think because, compared to men, women tend to be more disciplined when it comes to saving, are more open to becoming financially literate, and are better equipped to make good financial planning choices. Therefore, the more women engage, educate, and take control of their finances, the better off they are. It’s never too late to improve your financial literacy. Indeed, the more you know about financial products, concepts and practices, the better decisions you can make about your money.

-----------------------------------------------------------------------------------------------------