Financial Literacy- The Key To The Emancipation Of The Indian Woman

We speak of the empowerment of the Indian woman today, but the fact is women in India are still happy playing second fiddle to their fathers, brothers and husbands when it comes to managing their money. Even as we stand in the 21^st century, women are found shying away from managing finances because they lack the confidence to do so.

The fear of not having enough knowledge about financial investment avenues, the fear of making poor judgements or just the false sense of security that some male member in the family will manage the money, keep these women from achieving true liberation. As a result, if there is a sudden death of her husband the wife is left at the mercy of her male relatives. Sounds scary, doesn’t it? Well, it need not be, if women take simple steps towards demystifying investments and learn about wealth accumulation.

If you are a homemaker and don’t know where to begin, we suggest you begin by making a financial plan. Ask yourself questions like what is the budget of the household? What are your liabilities (loans, EMIs) and assets? Do you have an emergency fund? Do you keep a track of your expenses? Once you have the answer to these questions it will be easy to arrive at a financial goal. Your financial goal must be specific and must be defined as short term or long term. It can be as simple as making regular investments for a rainy day or saving up for higher education of your child.

The next thing you need to know is where to invest. A health insurance and a term insurance is an absolute must if you are in your thirties. This is also the time to invest in an appropriate retirement plan for your spouse and yourself. Keep away from the endowment plans as they carry higher charges and don’t yield returns that are as good. If you are planning to invest in gold, don’t make the mistake of buying gold ornaments. Invest in gold based funds or if physical gold is what you must have, purchase coins or bars of gold.

Lastly, if you are planning to apply for a loan or even a credit card for that matter, do not forget to check out your CIBIL score. Do not be under the impression that since you have made no application for a loan earlier, your credit information is not being tracked. Your credit score is derived from your credit history and is maintained in your credit information report. In fact new loans are sanctioned to those who have a credit score of 700 and above, so do bear that in mind.

So as you see ladies, in financial literacy and taking small steps towards financial planning lies your true freedom, so on this International Women’s Day we urge you not to crave for diamonds but for the elixir of financial knowledge!

Rajiv Raj is the Director and Co-Founder of www.creditvidya.com
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