Mahalia Jackson once said, “It’s easy to be independent when you’ve got money. But to be independent when you haven’t got a thing – that’s the Lord’s test”. Financial independence is one of the solutions to the many troubles faced by Indian women.
Making investments not only helps us in the situation of financial emergencies, but it also gives us peace of mind about our hard-earned money.
As we all know, the last year 2020, how it taught us the importance of savings and investments.
There were many jobs and salary cuts all around the globe due to which women suffered financially.
Let me tell you the story of Purvi, who works in a marketing firm.
Purvi took a New Year resolution on the evening of 31st December 2019, of making a trip next year with the salary hike she got that year.
After traveling to the Maldives in February, she also had few loans to pay off.
But then Covid was declared as National Pandemic and also her salary was cut off by 30%.
Now she understood the importance of savings. She thought that instead of taking a trip she would have invested her salary to face the current Pandemic situation.
We all have learned from this Pandemic that things do not go as we plan, so we should try to be financially independent to handle uncertainties in our lives, financially.
In this blog, we will discuss 5 Ways in which Women can start their Financial Independence Journey:
The 5-spoke Wheel of Financial Independence for Women:
1. Pay off Your Debts:
First of all, pay off your debts, be it credit card payment, house loan, vehicle loan, personal loans, EMI payments, and so on.
It is important that we first clear all our debts so that we can start saving for our future unforeseen situations.
Do not make a mistake like Purvi, who instead of clearing first her loans, went for a trip.
We will also get peace of mind also a good sleep at night that all our loans are cleared off and we are debt-free and attain the first step of being financially independent.
2. Make a well-planned budget:
After paying off all your credit card bills and loans make a budget.
Sit down with a pen and paper or you can also use an excel sheet and plan how much you are going to spend and save out of your salary each month.
While making a budget, cut off all the unnecessary expenses and by this, you can increase the amount of savings.
3. Do long term investments:
With that amount of savings as decided, start investing that money in long-term investments.
There are many investment vehicles available today like mutual funds, equities, government bonds where you can invest your money.
You can also take the help of asset management companies if you do not have time to research on your own.
4. Health Insurance:
Health Insurance is a Must!
As we have learned from this pandemic, how important is it to have health insurance.
As women, except for having health insurance, we should also have enough savings to cover all our medical expenses as well as of our family too.
5. Make Emergency Fund:
After doing long-term investments and getting covered yourself with health insurance make an emergency fund.
Keep aside some amount which can cover your basic expenses of at least 3-4 months.
As we have learned from the last year that life is full of uncertainties.
So, we women should take this opportunity to start thinking of our financial situation.
We should start saving and start investing in long-term investments to take the advantage of compounding.
We must make sure that our hear-earned money is safely invested and also giving us a decent return so that our future secure.
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Happy Women’s Day!