5 Investment Tips for Women to Start Their Financial Journey
It’s irrelevant if a woman is married or
not. It’s crucial she take charge of her finances. Financial planning is
as important for women as it is for men. Women have to take multiple breaks from
their career. They have to hunt for new jobs after marriage on relocating to a
new place, get back to work after a maternity leave, face gender discrimination
at work, accept a lesser salary than their male counterparts and choose to quit
working when its necessary.
Every woman has some savings of her own,
be it from salary or from the monthly budget allocated to the household. But
are savings and investments the same thing? That’s what women in rural areas
believe. As far as women working in the formal economy are concerned, they do
see the difference but don’t actually do much about it. Women should understand
that just opening a bank account or investing in simpler financial instruments
won’t reap great returns. The portfolio needs to evolve and must be constantly
monitored.
Saving v/s investing:
Though saving and investing are interdependent, there is a sharp
difference between them.
· Saving is setting aside money for
emergencies. If you deposit your savings in a bank account, you will get
minimal or almost no returns at all, if you consider the effects of inflation.Investing leads to wealth creation. It is a
systematic approach as to how you would like to invest money and earn higher
returns.
Women need to come out of their comfort
zone and think on the lines of investment and not just savings. Obviously, a lot of household
savings are done by the women of the household. Women in India now have the
option to save in fixed deposits or recurring deposits, besides the usual SB Account.
Gold and
informal chit-funds are other investment options widely used by women of the
middle-class. But, this is only enough to meet immediate and minor financial
needs and emergencies.
Just like charity, financial inclusion begins at home.
While women can start learning and investing in better ways, men have to take
the onus of involving women of the family in financial decisions. Financial
planning is as important for women as it is for men. While homemakers are
unaware and reluctant to save in options other than the traditional methods of
saving, metropolitan working women are just stuck with the thought of investing
in
The art of investing:
·
Learn and unlearn; educate
yourself:
Each step takes you closer to the destination. Therefore, start reading up on the various financial instruments and investment options. Don’t wait to be taught the art of investing. It is your money, so take charge. Attend personal finance workshops and download wealth management apps. This is the first step which will help build a good foundation for your financial life.
· Start investing with small amounts:
You cannot reach the summit of Everest on the very first day. You will not even reach half way without effort, patience and planning. So, start by investing in a few low-risk options like Public Provident Fund (PPF) and Recurring Deposits (RD). The minimum investment amount is as low as Rs 500 a year. PPF offers Section 80C tax benefits, up to a maximum of Rs 1,50,000 a year. You may also invest large amounts in tax-saving Fixed Deposits (FD).
· Get adequate insurance:
Women in India tend to have a higher life expectancy and also greater chances of developing lifestyle diseases. Then why avoid health insurance? A family floater health insurance plan is great, but it is not enough. When it comes to life insurance, typically only the husband buys a life cover. But, what is the harm if a working woman avails a life insurance plan? Irrespective of whether you are a man or a woman, a life or health insurance plan ensures the financial security of your family. It also offers tax benefits.
· Let your portfolio evolve:
. Explore investment options like SIPs (a method of investing in mutual
funds), mutual funds, equities, and so on. These investments give you
compounding benefits. Remember to educate yourself before actually investing in
these options.
· Monitor your portfolio:
Starting is one thing, continuity is another.
Therefore, make sure you continually monitor your portfolio. Managing
investments requires patience and knowledge.Keep updating yourself. Modify your
portfolio if necessary. Realize investments which are not doing well. Invest in
well-performing investments. As you realize greater returns, increase the amount
of investment in emergency funds, retirement funds and
children education funds. These are the steps to financial freedom; the sooner
you take them the better.
Be Wise, Get Rich
You Dream -> We Plan -> You Invest -> You Enjoy
Comments
Post a Comment