Hey Woman! Take Charge Of Your Finances To Be Truly Independent

Some Facts and Stats

• Lack of sufficient funds and home responsibilities largely come in the way of women’s aspirations to start their own business/venture as per a study conducted by Nielsen for biscuit major Britannia.
• A whopping 4% of women do not have a medical cover as per a survey conducted by Economic Times. Many separate studies across Indian states and cities have shown that women are wary of investing in the equity market.
• On the positive side,
  1. The number of Indian women investing in mutual fund schemes and stocks is on a rising trend which is a good sign.
  2. 27% of the stock market investors are women.

Indian women have come a long way in terms of education, independence and self-identity. But the tendency to leave financial decisions in the hands of the men in their lives – son, husband, father is still quite prevalent. Though this has been changing, it is important that more women take charge of their financial life as there are many indicators that women are good investors – Why?

• Indian women are historically and culturally well-versed with saving. Women save more and therefore can invest more.
• Women are more risk-averse as compared to men. Therefore they perform in-depth research before investing their money. They stay away from risky products.
• Women have more self-control. They are less prone to impulsive trading and over trading. Overtrading usually results in reduced performance portfolio.

But on the other hand, there are certain weaknesses that are inherent in women investors –

• They are very conservative investors and this can lead to reduced overall portfolio returns.
• On an average, women earn less. They also take breaks in their career. This leads to lesser funds available for investment. Since there is a smaller kitty, they prefer to invest in debt products which are secure but give less returns.
• They are busy with too many responsibilities of family and work that they do not find time to manage their finances.
• Women are not part of discussions related to financial matters in social realm as some feel they do not know anything. Sometimes they are not included as it is assumed they do not know much. These discussions are sometimes closed men’s clubs or informal networks; which are not easy to get into.
• Women are hesitant to ask for raises in salaries. They underplay their skills and achievements while negotiating for a pay package.
• Women let emotions rule and end up helping friends and family financially without considering the dent it would do to their financial portfolio. It is of course good to help others in need but not at the cost of putting yourself in financial peril.

Women have to play to their strengths and overcome their weaknesses and gain financial independence. Here are some steps that you can take to get involved in matters of personal finance –

1. Get involved in the finances of the household by managing a budget. It is the simple task of tracking income expenses and savings. You will get an idea of how much is the monthly expenditure and if you can cut back on some expenses.
2. Read up on personal finance. There are many personal finance websites and books that can be referred to.
3. Start investing small amounts in different financial products with the guidance of an experienced investor or financial planner to understand how investments work, the returns and tax implications and tax saving opportunities.
4. Set up financial goals and work towards achieving them. You will be really proud of yourself when you achieve it and gain confidence in financial matters.

Make your financial resolutions this Women’s Day to be truly independent

Key takeaways:

Women need to participate actively in financial matters.
Personal financial freedom should be every woman’s goal.