Investment essentials for women

Over time, the gender gap in workplaces has narrowed. The disparity in pay has narrowed. Day-to-day duties are shared by both men and women in most urban households. Currently, in many cases, women are breadwinners. All these are welcome signs of the financial equality of women. Financial freedom, however, is not only limited to providing a stable source of income and sharing expenses with household citizens. It is also vital to safeguard one's future and develop resources to achieve aspirations. A lot of women still rely on their male counterparts to do it on their behalf when it comes to financial planning. Regardless of your marital status, whether single or married, widowed or divorced, you have to take care of your finances in any way.

Let's look at a couple of main steps women need to take to improve their financial well-being.

Set and save goals accordingly.

You will not be able to earn an effective return in the optimal time frame if you are only hoarding money or blindly setting aside a fund in your savings account without mapping it to any target. To ascertain your investment tenure and risk appetite, set some targets and have a time frame in mind. Choose tools for investment that are best for each objective. Tell, in 10 years, you want to buy a home, or in 20 years, you expect to retire. These are long-term tasks completed for many years. Therefore, you should have a moderate to high risk appetite for the longer timeline, which increases the likelihood of earning above average or even high returns through options such as equity mutual funds or ELSS. In the other hand, you can place your money in low-risk and liquid instruments such as ultra-short debt funds or a revolving deposit for a short-term need, such as going on a holiday. Know, with investment in the right financial assets and ample time, all your goals can be accomplished.

Invest in SIPs from mutual funds

Mutual fund SIPs encourage you, just as in recurring deposits, to invest in a disciplined way and to achieve a lucrative return in the long-run. Mutual funds do not need to be timed like the stock market and the risk associated is mitigated over time by rupee-cost averages in SIPs due to investment in market-linked goods. So, with an investment of Rs 5,000 per month, if you earn an average annual return of 12 percent, you could create a corpus of Rs 50 lakh in 20 years. And SIPs make a sum as small as Rs 500 to start with. Your fund should be selected based on your tenure and risk appetite for investment. By investing in an ELSS, you can also combine tax savings under 80C as well as wealth creation.

Have your health covered

If you have relied on the health cover of your partner or your corporate cover, it is time for you to buy separate insurance to ensure adequate coverage. And when you are on the job will your corporate cover protect you. You will be left without any insurance at the time of the transition from one job to another or if you want to take a break in your career. For that matter, sufficient health insurance is a must to financially protect you from any health emergency or a prolonged illness. Insurance takes care of the rest of the costs for pre-and post-hospitalisation. Under Section 80, the premiums you pay for health insurance are eligible for tax benefits amounting to Rs 25,000. (D).

Establish an emergency fund

The purpose of establishing this fund is to protect you from any financial emergencies such as job loss, health danger, accident, etc. To create a corpus worth six to 12 months of your salary, invest in a liquid fund that does not have any exit load. If you were to face any unexpected circumstances and were temporarily without an income, it would be easy to pay your bills and rent, cover your day-to-day expenses and take care of your insurance and EMIs.