Financial planning for a working woman is as important as men’s these days. They contribute in boosting the family’s overall financial status which includes goals like buying a car, house, retirement plan, children education & marriage etc. Many working women despite managing the household finances proficiently, forget to plan their own 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. If a woman also sets financial goals and investment plans, it will strengthen the financial stability of the women along with the household.
In spite of being a working woman, a lot of women are financially dependent on their partners. 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.
Let’s see these 5 financial tips working women must follow
- Clear your debts: Women these days can readily avail the credit cards. They might even borrow loans for kids’ education, buying a car or children’s marriage. Make sure to clear all the debt by the time you reach 50. It is advised to repay all credit card bills and loan EMIs on time as the interest adding up due to payment delay is not good for financial health. Piling of any kind of 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.
- Retirement Planning: The cost of living has risen sharply in recent years. The retirement planning with just one partner’s earnings might not be enough to sustain both for a decent life later. This is why working women must have a retirement plan as well. Make sure to invest from the various investment instruments and schemes available, as this 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.
- Emergency Fund: Having an emergency fund is of vital importance 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 an 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 which can happen for any reason like job loss, medical emergency, accidents, deaths etc. Make sure to have a good amount in your emergency fund.
- Investments: A lot of working women often skip from making any direct 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 additional income tax benefits. Women need to invest in investment instruments to earn interest and reap returns. With the passing of 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.
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. Always be detail-oriented when listing assets and beneficiaries. Make sure to update your will periodically and choose a trustworthy executor.