Women are becoming financially independent at a faster pace now, leading to more conscious financial plans and goals coming to the fore. With financial freedom comes bigger financial goals and even though what women want to achieve is right, the way they go about executing it could come to a standstill if done with incomplete information.
Every day is a woman’s day because of the multi-faceted roles as professionals and even in their family. Only for the way they organize the lives of everyone around them, here are a few ways to help them shape their financial independence with goal-oriented planning!
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Budgeting is Golden
Everyone believes that women have a natural knack for budgeting. Being the one who takes a call of where one has to splurge and where one has to hold back, women are pro at budgeting. It will also ensure that your bills are paid on time and your savings are on track. With a regular income, a woman should allocate income in the ratio of 50-30-20.
The most significant chunk would go to regular spending and necessities like home expenses, rent, etc. The second most considerable chunk would go toward leisure activities and luxuries like shopping, watching a movie, restaurant visits, etc. 20% would be the amount of savings invested in different instruments depending on your age and risk appetite.
Money goals define your plan
Identify the reason behind your savings. Do you want to save for a rainy day or your retirement? Depending on which one you choose, your tenure, the amount of money to be accumulated and even the type of investment you would require would change.
As per the general norm, an emergency fund should be equivalent to three to six months of your income which can be useful during sabbaticals which are very common in women’s careers. Emergency funds work well In a setup where a family runs on double incomes and moves to a single income framework due to numerous reasons.
Apart from that, due to several responsibilities, women tend to retire sooner than men. In such a scenario, it is always advisable to have your retirement fund ready to ensure that your family faces no pressure.
Identify which investment will contribute to which goal
Have clear and defined goals for every stage of your life, whether it is for the time you will pursue your higher education or plan to fund your children’s education. If you have recently started earning, then start your savings journey early and get into the habit of saving a fixed part of your income.
Invest in liquid funds if you want to save for goals you want to achieve in less than three years. If you have at least three years, invest in different investment instruments like mutual funds, FDs, etc. If your goals are over five years away, go for options that need time to mature and reap more significant benefits.
In addition to that, buy assets that generate income and are likely to appreciate over a period of time.
Get Yourself Insured
While you are rigorously planning to safeguard your future, it is also important to insure your life and health. Women can be subject to several reproductive and lifestyle ailments to protect themselves. This brings in the coverage of several diseases and any unforeseen unfortunate incidents. It is essential to take care of yourself and protect your financial kitty from sudden blows of huge health expenses.
Go for health insurance that protects you from the most common and rarest of rare diseases. In addition to that, a woman needs to get term insurance and ensure that her family is taken care of in dire situations.
Educate yourself about government initiatives
If you are a working woman, you could leverage several benefits offered to you by banks and the government. For example, several banks offer special women bank accounts with reward points and other services attached to the card. In addition to that, several government institutions provide scholarships for women, empowering them to hone their skills and grow in their careers.
In addition to all the pointers mentioned above, women must also keep an eye out for more risk-averse high return investment options considering their age and work experience. Since women nowadays start their careers early on, they can invest for the long term and direct it towards bigger financial goals.
Always remember to avail credit solutions wisely and always consider your repayment capacity while doing so. In order to get the best credit options, you will need to maintain a healthy CRIF Personal Credit Score not just now, but at every stage of your life.