I have always felt huge pride in being an independent woman living in Mumbai and building a life for herself. What I am not so proud about is that I never actively saved. I supported my parents in whichever little way I could…but mostly I spent all my hard-earned money on clothes, shoes and eating out! Well I saved the bare minimum for attaining Income Tax exemptions. When I got married, my saving habits improved quite a bit thankfully. Having been independent for so many years, meant that I would resort to only the money I earned to spend. I didn’t like the idea of asking my husband for money. I would have continued on my self-reliant ways if something hadn’t gone tragically wrong.
I was forced to take a sudden break from work owing to severely poor health towards the end of last year. It took me a while to recover from my illness. Quitting work had affected my confidence and brought me to the dumps. I was questioning my abilities and my future. I knew I had to pull myself up and turned to my passion – writing.
Now all writers know that freelance writing projects are hard to come by and my liquid savings were dwindling. I had invested all my savings in long term saving instruments for tax purposes and today I have ended up in a situation I never thought I would – dependent! Reluctant to break my Fixed Deposits or close my Mutual Funds meant that I did not have liquid cash to tide me over till I start earning again.
So while I broke one stereotype by becoming a working woman, I did not break the other stereotype of women not being good with money. I am a graduate in Commerce and a Post Graduate in Economics and yet I did not plan, save or invest well enough for my financial security! Of course my husband was and is supportive and so are my parents in law. But my parents constantly remind me of the importance of being financially independent, lest I get carried away and get too comfortable with being taken care of.
I hope to be up and running soon. But my situation has got me to ponder on the reasons why a lot of well-educated and qualified women become financially dependent on their husbands and remain clueless about the way money functions. Before that, we need to ask a very important question:
Why is Financial Independence Important for an Indian Woman?
1) To save money to tide over bad times
2) To boost her morale and confidence
3) To break the rigid norms that society has in place
4) To support her parents
5) To invest in a better future for herself and her family
Reasons why Indian women become financially dependent
In unfortunate circumstances, many women don’t enter the workforce at all. They either don’t equip themselves with sufficient qualifications or even if they do, they end up getting married just after studying. Owing to gender norms, they move from being financially dependent on their fathers to their husbands. These are the women that make India rank a dismal 120th among 130 countries in women’s participation in the workforce.
But there are several life situations that could cause a well-qualified woman to become financially dependent –marriage, pregnancy and child birth, career shift, further studies, and health issues.
Marriage and child-birth are traditionally considered very important milestones in a woman’s life- big enough for her to focus all energies on them, barring all else. It’s unfortunate that even today very few will question a non-working wife. The duration of career break in these cases could last anywhere between 3 months to never returning to the workforce.
A smart and confident woman may continue to work post marriage. In fact she may be so ambitious, that she may decide to take a career break to study further. A rare occurrence, but such women still may need to worry about tiding over up to 2 years of career break.
She may also wish to change her job or career or be forced to do so owing to health issues, necessitating a break from work that could last to a year or more.
Very few women go through life without taking a career break at all and yet, very few women prepare for it.
Why don’t a lot of Indian women manage their finances well?
I am not generalizing. We all know of many inspirational women who have excelled in the financial sector. There are many women who carefully invest time and effort in managing their finances. But, here is what feminists like me would have to accept – a large percentage of women depend on men to take care of their finances especially when they are on a break. Of course it has to do again with cultural conditioning. Men are considered better at managing money. But that’s just because they do more of it and have got good because of all the practise they’ve got! As Feminists, women have no right to ask for equality, if we don’t take responsibility for our finances. Today, when the divorce rates are on the rise, it becomes even more important for women to know the complete ins-and-outs of their money. The courts of today are becoming more and more reluctant to instruct husbands to award ‘maintenance’ to their ex-wives who are qualified.
So how can you increase your financial aptitude:
1) Become more aware of your finances
Create an Excel Sheet in order to
a. Keep a track of all your earnings, investments and savings
b. Keep a track of your expenditure
c. Keep a very close track of your credit card and other debts
2) Learn how to manage your money better
There are several online and offline courses, websites, youtube videos, blogs etc. to help you learn how to make your hard-earned money work to make more money! No more excuses – get down to it. Understand your risk-appetite and accordingly choose the right investment vehicle.
3) Have more conversations with your husband about money
It’s important that both husband and wife are committed to a secure financial future. Women tend to not talk about money. But it is these conversations that help you learn more and get better at money management.
4) Create a Contingency Fund
This is a very crucial step to take for a stable financial future. The rule of thumb is to have a contingency fund of at least 6 times your regularly monthly income that is liquid but remains untouched except in case of emergencies. So you have at least 6 months of savings to get back on your feet in case of emergencies.
5) Goal planning
Other than monthly expenditure, you must take joint decisions with your husband on important aspects such as how much money do you want to keep aside for retirement, children’s education or even holidays.
For more tips on managing your money, visit a friend’s blog that will help you kick off your financial journey.
Fellow Women, let’s not be hesitant. Let’s not be ignorant. Let’s definitely not be dependent. We have got to conquer our finances first in order to go on and conquer the world!