5 Things Related to Managing Money That Women Need to Know
Traditionally men have been the breadwinners and women have been confined to household duties. In this setup, women were just given a certain amount every month by their husbands for groceries and for other small purchases.
Women learned the art of saving there too. I remember how my mom used to save some money out of the monthly allowance. She hid her stash in an empty jar in the kitchen tucked away behind the other spices. This was her savings for a rainy day which she used to pay our school fees in case the money fell short or buy something for herself once in a while.
Now as more women become part of the workforce we might know how to save but still shy away from independently handling money or even investing.
I know many women who let their husbands or fathers handle their investments and some even let them take care of all their earnings. I am not saying your father or husband will cheat you but placing all your hard-earned money in the hands of others will leave you vulnerable.
An acquaintance of mine whose husband passed away due to a bike accident had to deal with all her savings eliminated even when she held a decent job because she had let her husband handle all the finance. A lot of people came knocking on doors claiming her husband had borrowed money from them and she had no money to pay anyone. It took her a long time to sort out all the finances and she had to move to start fresh. Yes, this is a one-off incident and might not happen to everyone but it is always better to be in control of your situation at least financially.
Have your own savings account
Even when you have a joint account with your spouse or father, have your own savings account for which you are the sole account holder. Keep your emergency money there. A joint account is useful when dealing with bills and living expenses but you don’t have to put all your eggs in one basket. Especially the one you share with someone else.
Understand nomination
We never expect bad things to happen to us. But it is always better to be prepared in the event of an untoward situation. Add nominees to your accounts and investments. Savings account, mutual funds, Provident Fund (PF), Term Insurance(for those who have one at work), etc., all have the option of adding multiple nominees and you can even assign the share of the money that would go to the different nominees.
Don’t just save, invest
Yes, our moms were experts in saving and keeping a stack of cash under her sarees in the cupboard or in the kitchen in the empty jars. You don’t have to just limit yourselves to saving or choosing only safe investment options like FDs and RDs. Read about mutual funds and start your SIP today. Understand risks and returns. Remaining invested for the long term will always yield better returns than traditional investment options.
Have the talk
If you are married have a talk with your spouse about all their financial transactions. It does not mean you are prying. It is important to know where both of your money is parked and will help sort out issues in case of any unforeseen circumstances in the future. If you can, make a will and keep it updated. Keeping a record of all financial assets in a secure place also helps. If you are a single woman, then make sure you have a will so that no one misuses your hard-earned money if something was to happen to you.
I apologize if all this sounds too grim to you but life is not fair and you don’t want to be stuck with this mess when dealing with the loss of your loved ones.
Invest in Gold not jewellery
Diamonds might be a woman’s best friend but buying gold jewellery as an investment option certainly is not. If you like jewelry and want to buy them, then go ahead and splurge. But if you are buying they are a good investment option then don’t. Buying physical gold especially with the horrendous 25% of making charges that these jewellery stores charge does not make sense, right? Because the value of your jewellery is lesser than what you paid to buy it and gold has to appreciate a lot to give you enough returns.
Physical gold is also risky to store at home and paying money to buy lockers in banks is just an added expense. Consider investing in Gold Bonds instead and you won’t have to worry about any of the above problems.
Money can seem like a scary thing to manage and it might even seem easier to give the ‘responsibility to your spouse, father, or elder sibling. But we owe it to ourselves to learn how to manage money. This way we can be truly financially independent.
