When financial planning comes into the picture, the longevity problem is a harsh reality check for most women. According to a report by the World Health Organisation (WHO), women tend to live longer than men by an average of 6 to 8 years. This essentially translates that women would require a bigger financial reserve than men to cater to their post-retirement needs. To add fuel to the fire, women have to deal with several financial setbacks by virtue of their gender that results in either derailing or delaying the process of investments. One of the biggest challenges is the gender pay gap which is prevailing in almost all parts of the world.
Having said that, today’s women too have stepped up their game and are becoming more financially independent. They realize the importance of investing and have started taking financial planning seriously. If you haven’t started with your financial plan, fret not. Following are a few tips for women to help them better manage their finances:
- Devise a budget
Basis your yearly income or salary, devise a personalized budget considering various parameters such as risk appetite, financial goals, and objectives, investment horizon, etc. If you are a beginner, you might consider undergoing the 50-30-20 rule. Under this rule, an individual is expected to allot nearly 50% of your salary to basic necessities, around 30% should be allotted towards varying investment options and the remaining 20% can be utilized to live life queen-size.
- Arm yourself with the required financial knowledge
One can make wise investment decisions only when one is endowed with the needed financial knowledge. Be well-versed with the different types of investments available to you and choose the one that best suits your financial portfolio. In this technology-amped world, there is plenty of information available on the net that can help you make an informed decision. If you are new to the investing world, one of the preferred investment options is mutual funds. You can invest in mutual funds either through IP investment (Systematic Investment Plan) or lumpsum investment basis several parameters such as the availability of funds, financial objectives, etc. - Plan your tax outgo
Nobody likes the additional outflux of money from their pockets, not even to pay taxes. Instead of being entirely dependent on your CA, it makes sense to take matters into your own hands and provocatively plan for your tax outgo. You can also take the services of a financial advisor who can guide you in making the right investments that help to save tax. - Retire like a queen!
Do not forget to take into account your retirement planning. Make sure you have invested in the right investment options to ensure that you retire like a queen.
Experts suggest individuals choose mutual funds basis their financial objectives, investment tenure, and risk profile. Realize the importance of investment and begin your investment journey today to become truly independent. Happy investing!