While there is still a raging debate out there on whether women can really have it all, it is important to acknowledge that women do have to often make career and finance related sacrifices when they start a family. Often it can happen, that post starting a family, women’s earnings and careers remain in the slow lane till the kids are grown up and they are able to get back to work in full swing. Women either take leave from work, move to job profiles that are less demanding on time and energy or take up part-time work.
Not only does this phenomenon have an impact on the family’s finances, it can also make women psychologically vulnerable. Women who have so far been financially independent, now have to deal with a feeling of some dependence, which can be a challenge even with the most supportive husband and family. Added to this is the fact that in the current times, marriages are not as stable as has historically been the case in the Indian context. In the event of a divorce or even an unfortunate event like the better half’s mortality, the woman can have a huge responsibility to cope with.
This begs the question: How can women plan and secure their finances best to ensure some security, freedom from financial stress and even better self-worth? The three points outlined below could help you navigate through the financial hurdle race on the way to creating a secure family life:
1. Plan for a family early: If you as a married couple wish to start a family, it would help to financially prepare in advance for the scenario. If you are looking to start a family two years from now, start assessing today what you would like your financial standing to be when you do have a family. This is important, since planning a family means increased expenses. Since one part of the couple, usually the woman, takes a step back on the career front when starting a family for both biological and societal reasons; it means that the woman’s incomes will be impacted by the decision. When assessing your financials at the time of your starting a family, take into account the fact that the loss on income will potentially be higher, since salaries increase overtime. This may or may not be offset by an equivalent increase in the partner’s incomes. Also, take into account the fact that prices will rise overtime, which will inflate the overall budget, with or without an addition to the family. Planning now will ensure that you are able to set aside a proportion of your income as return generating investments, which can at least partially provide for expenses at a later date.
2. Ensure a personal financial safety net: In order to ensure financial security, when you start a family, make sure to have investments in your name as a woman. While investments in the couple’s name and in the husband’s name are security enough in regular scenarios, in the event of a situation like a divorce, it can create an extremely stressful situation. It will do no harm to therefore have personal investments. Make a commitment to investing regularly from your monthly incomes. During the initial years of work, you are usually capable of taking on riskier investments in financial instruments like equities. However, given the prolonged challenged economic scenario, equities have been quite unpredictable in the recent years. Since you would like assured principal as well as returns to investments, do explore financial products, like debt, combination of debt and equity or principal protected funds to ensure that your savings are secure and growing. Some amount of investment in liquid assets will also help, since they can double up as an emergency fund. Also, make sure to have life and health insurance coverage for both you and your spouse. While a number of companies provide insurance coverage for their employees, there are others that do not. Also, it is possible that even if you are covered, the coverage is adequate for your financial goals. Adequate medical insurance is particularly worth mentioning here, since the last thing you would want is a drain on hard earned money in the event of an expensive medical requirement.
3. Become active in financial matters: Often, women tend to leave investment related financial decisions in the hands of their better halves, while concentrating more on the expenses. This is largely a historical tendency, since women are traditional homemakers while men used to go out to earn. Even as women have moved out of their homes into formal workplaces, the responsibility for investments is still considered to be that of the household’s male member. In the present times, there are easy and accessible tools for everyone to become financially aware and educated. These can be found in the form of books, multi-media, trainings and there are plenty of free resources on the internet itself. The more aware women become of financial matters beyond earning and expenses, the more likely it is for them to take charge of their financial destinies. While it is desirable that women become financially aware as soon as start earning, if not earlier, some time off when they start a family can be a good time to come up the curve on finances. Knowledge of the best financial investments for you personally and as a family can help provide greater security to you, take off some responsibility for the same from your husband’s shoulders and also give you more confidence in managing and even growing your finances.
These are just a few options that you have as a woman looking to create a secure family have when planning for the future. While each individual and family will have different needs based on their starting finances, education levels and career trajectory, a bit of financial planning can still go a long way to ensure that you and your family are financially secure!
Not only does this phenomenon have an impact on the family’s finances, it can also make women psychologically vulnerable. Women who have so far been financially independent, now have to deal with a feeling of some dependence, which can be a challenge even with the most supportive husband and family. Added to this is the fact that in the current times, marriages are not as stable as has historically been the case in the Indian context. In the event of a divorce or even an unfortunate event like the better half’s mortality, the woman can have a huge responsibility to cope with.
This begs the question: How can women plan and secure their finances best to ensure some security, freedom from financial stress and even better self-worth? The three points outlined below could help you navigate through the financial hurdle race on the way to creating a secure family life:
1. Plan for a family early: If you as a married couple wish to start a family, it would help to financially prepare in advance for the scenario. If you are looking to start a family two years from now, start assessing today what you would like your financial standing to be when you do have a family. This is important, since planning a family means increased expenses. Since one part of the couple, usually the woman, takes a step back on the career front when starting a family for both biological and societal reasons; it means that the woman’s incomes will be impacted by the decision. When assessing your financials at the time of your starting a family, take into account the fact that the loss on income will potentially be higher, since salaries increase overtime. This may or may not be offset by an equivalent increase in the partner’s incomes. Also, take into account the fact that prices will rise overtime, which will inflate the overall budget, with or without an addition to the family. Planning now will ensure that you are able to set aside a proportion of your income as return generating investments, which can at least partially provide for expenses at a later date.
2. Ensure a personal financial safety net: In order to ensure financial security, when you start a family, make sure to have investments in your name as a woman. While investments in the couple’s name and in the husband’s name are security enough in regular scenarios, in the event of a situation like a divorce, it can create an extremely stressful situation. It will do no harm to therefore have personal investments. Make a commitment to investing regularly from your monthly incomes. During the initial years of work, you are usually capable of taking on riskier investments in financial instruments like equities. However, given the prolonged challenged economic scenario, equities have been quite unpredictable in the recent years. Since you would like assured principal as well as returns to investments, do explore financial products, like debt, combination of debt and equity or principal protected funds to ensure that your savings are secure and growing. Some amount of investment in liquid assets will also help, since they can double up as an emergency fund. Also, make sure to have life and health insurance coverage for both you and your spouse. While a number of companies provide insurance coverage for their employees, there are others that do not. Also, it is possible that even if you are covered, the coverage is adequate for your financial goals. Adequate medical insurance is particularly worth mentioning here, since the last thing you would want is a drain on hard earned money in the event of an expensive medical requirement.
3. Become active in financial matters: Often, women tend to leave investment related financial decisions in the hands of their better halves, while concentrating more on the expenses. This is largely a historical tendency, since women are traditional homemakers while men used to go out to earn. Even as women have moved out of their homes into formal workplaces, the responsibility for investments is still considered to be that of the household’s male member. In the present times, there are easy and accessible tools for everyone to become financially aware and educated. These can be found in the form of books, multi-media, trainings and there are plenty of free resources on the internet itself. The more aware women become of financial matters beyond earning and expenses, the more likely it is for them to take charge of their financial destinies. While it is desirable that women become financially aware as soon as start earning, if not earlier, some time off when they start a family can be a good time to come up the curve on finances. Knowledge of the best financial investments for you personally and as a family can help provide greater security to you, take off some responsibility for the same from your husband’s shoulders and also give you more confidence in managing and even growing your finances.
These are just a few options that you have as a woman looking to create a secure family have when planning for the future. While each individual and family will have different needs based on their starting finances, education levels and career trajectory, a bit of financial planning can still go a long way to ensure that you and your family are financially secure!
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