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New Delhi: Financial planning is just as important for working women as it is for working men. A lot of working women despite managing the household finances proficiently, forget to plan their finances properly. While men in the house have set financial goals and have proper investment plans in order, women often do not have any such plans.
Financial planning is just as important working women because it will boost the family’s overall financial plan which includes goals like buying a car, house, retirement plan, children education and marriage etc. If a woman also has financial goals set and investment plans, it will strengthen the financial stability of the women along with the household.
Apart from this, a lot of women are financially dependent on their partners despite working themselves. This is a result of poor financial planning. If women plan their finances and investments well, they will be financially independent which is extremely beneficial in the long run.
5 financial tips working women must follow
1. Clear your debts: Most working women have credit cards. They even borrow loans for kids’ education, buying a car or children’s marriage. If you are one such woman, make sure to clear all the debt by the time you reach 50. It is better to repay all credit card bills and loan EMIs on time and the interest caused due to payment delay is not good for financial health. Piling debt can eat away at your retirement savings, so make sure to clear all your debts by the time you are close to the retirement age.
2. Retirement Planning: As the cost of living goes up, retirement planning of just one partner might not be enough to sustain both partners. This is why working women must have a retirement plan as well. Make sure to invest in investment instruments which will help you generate a good retirement corpus by the time you are 60. Keep old age health and medical expenses and other expenses in mind while investing. This goal will secure your post-retirement phase.
3. Emergency Fund: Having an emergency fund is a must for everyone. Life is unpredictable and you never know when you might be in need of some urgent cash. An emergency fund is like a cushion which you can fall back on in case of a financial emergency. One must always save money consistently every month from their salary to have enough money their emergency fund. This accumulated money will help you during a financial crisis caused due to job loss, medical emergency, accidents, deaths etc. Make sure to have a good amount in your emergency fund.
4. Investments: A lot of working women often shy away from investments as they find them risky. Investments are a good way to boost your wealth and there are are a lot of risk-averse investment options out there. Some investments even offer income tax benefits. Women need to invest in investment instruments to earn interest and reap returns. As you age, make sure to re-allocate your assets according to your needs and requirement. This will help you save up a lot more by the time you retire and even after that.
5. Write your will: A will ensures that your assets, property, possessions and money is handed over in the manner you desire when you pass away. It is not complicated as you can create it using pen and paper, an online template, or hire the expertise of an advisor. Always be detail-oriented when listing assets and beneficiaries. Make sure to update your will periodically and choose a trustworthy executor.