Ladies! Empower Yourself with Financial Literacy

The writer lists out the ways by which women can enhance their knowledge about personal finance and investments

One of the strong characteristics of Indian women is the habit of saving. This is mainly done in the form of cash or physical gold. Demonetisation of high value notes by the government has revealed the tremendous capacity of the Indian women to hoard cash unknown to their family members. However, they do not distinguish between savings and investments without realising the loss that they are incurring. The money held in cash would have doubled, tripled or multiplied even more if the same would have been invested properly in different types of financial instruments such as bank deposits, government saving schemes, mutual funds, stocks and shares and such other investments.

Another characteristic of Indian women is to rely on their fathers or their husbands to make financial decisions even though they work or hold senior executive positions. This dependence makes them vulnerable and disempowered in day-to-day life. Taking responsibility and control of your money is one of the big steps towards feeling empowered.

Yet another characteristic of Indian women is that they are unaware of the investments, financial liabilities, insurance and other financial decisions of the family. There are instances where, after the sudden death of the husband, the lady hardly has any idea about where and how her husband had invested when he was alive. To avoid such a situation, women should insist on being part of the financial planning process for the family from the start. For self-esteem, irrespective of economic status, women should stay engaged in productive activities that might give an income, be it while being a homemaker or when stepping out to work. For better marital relationships, any decision on spending, investments or any other financial matter should be taken in consultation with each other.

In India, on an average, women live a couple of years more than men. With the result, most women live alone for a few more years. With their relatively less knowledge about finance and investing, they face problems. So, it is important that women start learning about investing and participate in the family’s financial planning process.
All these issues can be resolved by enhancing the financial literacy levels of Indian women. This is not very complicated and does not require one to go and take a long duration course in finance. There are some simple measures that one can adopt to enhance knowledge about personal finance and investments.

– Irrespective of your age, you should take the first step in financial independence by personally visiting banks for deposits, withdrawal and other transactions.
– Learn internet banking to carry out bank operations from home. In the process you will learn a lot of things about banking, cyber security, password protection etc.
– Use ATM cards, credit cards, and GooglePay freely. This will boost your confidence.
– Start stock investing by opening demat account through your bank account.
– Immediately exchange passwords (P/W) of demat account, bank accounts, ATM, credits cards with husband and vice versa and write down safely. Death comes unannounced as in case of recent pandemic.
– Meet your family tax advisor, financial planner, legal advisor in person to keep you updated with the latest position of your finances. This will also help you to understand where your family stands financially to live within means. In today’s world of show business in Goan closed society, men tend to hide their real financial position about earnings and borrowings from the wife. Be aware of your husband’s earnings and financial liabilities and manage your household accordingly. Learn to live within your family’s means.

Based on this information, you should identify your family’s short term, mid-term and long-term financial goals in close consultation with family members. Now the next step would be to plan and execute the same.
Insurance: Your first priority should be to have adequate insurance cover on the life of your husband on whom your family depends to secure your and your children’s future –education, marriage etc in case of untimely death. Ideally, insurance cover should be 20 times of your annual expenditure. You can have a ‘term life policy’ for this amount which has minimum cost. In case your family is financially dependent on you, your life should be covered accordingly as well.

House: If you are living in a rented house, plan for your own home. To encourage women to have houses in their own name, financial institutions offer concessional rates to women buyers and also for stamp-duty. Irrespective of this, you should ensure that your name is included as joint owner of the property. Apart from emotional security, a house provides appreciation in value.

Will: If you do not wish your children to fight over property after your death, execute a Will. A Will is a legal document which provides the manner in which a person’s property will be distributed after death. A Will can be executed on a plain paper in one’s handwriting in the presence of two witnesses. No stamp duty is required. Registering the Will will help further for smooth inheritance and clear title.

Emergency Fund: Create an emergency fund, education fund, marriage fund for your children through systematic investment plan in mutual funds. Build an adequate retirement fund through regular savings to live happily in old age without depending on your children. Discuss this with your financial advisor.
Investments: Learn about investment in mutual funds, government securities, stocks, real estates, gold etc. This is a slow learning process. Discuss money and investments with friends and family; watch business channels on TV, read investment magazines regularly. Lot of material is available on the internet to build your knowledge of investment avenues.

Nominee: Ensure that your name is registered as a nominee in all bank accounts, life insurance policies, mutual funds, housing society membership etc. Do not rely on your husband.

Health Insurance: Have an adequate health insurance cover which will take care of medical needs of the entire family.There are many other things that women should carefully follow if they want to avoid getting into a financial mess. I have listed some of these matters.
– Do not sign any blank paper even if requested by your father, mother or husband.
– Do not give general power of attorney to anyone including brother, father or husband, unless required for specific purpose.
– Do not stand surety or guarantor for any type of bank borrowings even for your own children.

– Do not share your password/s.
– Do not sign any paper blindly unless you have understood its implications.
– Do not get emotional and gift or transfer your home in which you are residing to your children during your lifetime.
Apart from all this, remember that health is wealth and is integral to financial well-being. Women, being the foundation of the family should take care of their health with annual checkup and with proper diet, regular exercise and healthy lifestyle with composed temperament.
Strength of the family is a strong knowledgeable woman. Be One!

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