FINANCIAL EMPOWERMENT FOR WOMEN
(PART 1 OF 4)
· While women are equally rational and materialistic like men, they are normally reluctant to manage money themselves and let the men in their lives take charge of their finances.
· It is mostly due to society pressures or perceiving finance as a very boring and difficult subject.
· This lack of financial literacy creates financial insecurity, which results into disturbing social fallouts for them like abuse, cheating and mis-sold financial instruments.
A. CAUSES OF FINANCIAL INSECURITY
· Relegating themselves to passive roles in family matters with low self-esteem.
· Deputing the investment of money to their father, husband and sons.
· Not regarding themselves as primary providers even when they are working.
· Not seeking information about their financial position and well-being in the family.
· Reluctance in empowering themselves financially by upgrading their financial skills.
B. STEPS TOWARDS FINANCIAL EMPOWERMENT
· A woman should understand that she is the best judge of her needs, and believe in it.
· She should work towards satisfying these needs than expect others to do it for her.
1. BUDGETING AND BANKING
· Record the inflow and outflow of your money in a diary (or an online planner).
· Budget your monthly expenditure, of your own income or the amount received from your spouse.
· Save 10% of your income through your budgeting efforts.
· Learn the basics of banking, like opening a savings bank and fixed deposit account.
· Use your own account for your saved money and making it to grow at a nominal rate.
· Learn tasks like the working of an ATM card, writing a cheque, and reading the bank account statement.
· Try to learn Net banking or mobile banking so that you can view your account statements, pay utility and credit card bills, transfer funds, recharge your phone, and even pay loan EMIs.
2. SPECIFYING FINANCIAL GOALS
· Identify your financial goals, along with the amounts needed, and write them in your diary.
· The short-term goals could be going on a vacation or buying a car.
· The medium-term goals could be saving for your kids’ education and buying a house.
· The long-term goals could be retirement planning.
· Don’t indulge only in the present, and chalk out clear, realistic financial goals at an early stage.
· Remember that saving for retirement should be the topmost priority as women
o live 5-7 years longer than men on an average
o work for fewer years due to child caring responsibilities, and
o earn lesser than men in the same occupation and at the same qualification.
· Start saving for retirement the minute you start working, or getting a fixed amount for your household expenses, for tapping the power of compounding to grow your saved money.
· You can compromise everything else, but you can’t cut down on your retirement savings.