How to Become a Financially Independent Woman?

Ideally, every person, whether a man or a woman, needs to be financially independent. But do you know that out of every 5 investors in India, only 1 is a woman?(Source) It’s an alarming statistic that speaks volumes about the lack of financial independence for women in India.

Here, it is common for women like you to sacrifice financial independence when you become a mother or when household demands become a priority. But you know, this needs to change, and for a while now, things have been changing for the better – but, there’s still ways to go.

With the right tools and strategies, you can take charge of your financial future and become financially independent while balancing your personal life.

What Exactly Does Being Financially Independent Mean?

Many people think it simply means having a large amount of money in the bank, but it’s much more. Financial independence is the ability to support oneself financially without relying on others or external sources of income.

For instance, women’s financial independence might look like this:

  • Having adequate time to indulge in interests and pleasures.
  • Not requiring assistance from others.
  • Taking it easy before or after retirement thanks to wise financial decisions.
  • Keeping up a career and starting a family.
  • Residing in a lovely house or a desirable area.

Typical Financial Challenges for Women

Do you ever feel like it’s challenging to accumulate wealth and save money for the future? These could be a few explanations if you’re nodding your head in agreement!

  • Mobility Concerns & Social Norms

    When it comes to financial independence, women often don’t have the same chances as men. For instance, mobility constraints can make it challenging for women to access financial services and assistance. In some nations, like India, husbands may even restrict their wives’ freedom to leave the house.

  • Non-participation

    Women who are excluded from the financial world are harder to spot. Banks sometimes do surveys, but those are limited to people who are part of the financial system. However, due to a lack of network and sources of recommendations, women find themselves in oblivion to finance.

  • Pay Gaps by Gender

    The Indian Constitution’s Article 39 states that both men and women are entitled to equal pay for equivalent work. But it doesn’t happen very often! Wages of women were 18-26% lower than men in the 4 quarters from Jul-Sep 2019 to Apr-Jun 2020 according to Periodic Labour Force Survey (PLFS) 2019-2020.

  • Women Have Emotional Bonds

    Women link financial loss with failure and shame. This one factor alone accounts for one of the main reasons why financial freedom for women is far-fetched: they often have a lower risk appetite than men.

  • Career Breaks for Long Periods

    In many countries, like India, women take on the role of primary caretaker. Women experience more prolonged absences from their jobs due to pregnancy, parenthood, sick parents, and other dependents.

Why Does a Woman Need To Be Financially Independent?

Despite all the challenges listed here, financial independence for women is crucial. Here’s why:

  • To Prepare for the Unexpected

    Layoffs are increasingly common, making job security uncertain. If the husband is the sole breadwinner, his family is at risk. So it’s wise for the woman of the house to have an outside job to support expenses and EMIs.

  • To Meet the Rising Cost of Living

    Every person of working age in a family needs to contribute, given the high living expense that the present generation must endure. Financially independent women can help families with rising living expenses, own a home, and send children to a good school.

  • To Be Able to Help Yourself

    If you are financially dependent and face the cycle of domestic violence and sexism, you won’t be able to get out of it due to reliance on money. To avoid feeling helpless in front of injustice and criminality, you must know how to become a strong and independent woman.

  • To Live With Dignity

    The fact that women typically outlive males in India should be taken into account because many of you ladies may live your later years alone. So, to live with dignity and freedom, take trips, and buy what you want, you must earn and save money.

Genius Tips to Become a Financially Independent Woman in India

When it comes to being financially independent, many women don’t know where to start or how to go about it. But don’t worry. This post have you covered! Here are 7 genius tips to help you become financially independent:

1. Enhance Your Financial Knowledge

It’s essential to understand the basics of financial planning. Familiarizing yourself with financial topics such as budgeting, debt management, credit scores, retirement, investments, and insurance will help you make better decisions. You can read books or surf the internet for all the necessary information.

2. Make a Financial Plan

Before making any significant financial decisions, creating a financial plan is crucial. Financial planning for beginners can be daunting so start with simple goals. First, establish your financial aim – Track your income and expenses – And develop a budget that works for you.

3. Start Saving for Emergencies & Establish a Credit

Make sure you have an emergency fund (3-6 months of expenses) in a savings account. Another necessary money-saving tip is to build a good credit score by paying your bills on time. You may need credit to avoid paying for something from your savings! Also, open a savings account with maximum benefits and interest rate.

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4. Make Quick Investments

Investing your money is the next step after securing your emergency fund. It is one of the best ways to beat inflation. Start with low-risk, high-reward investments like mutual funds and exchange-traded funds. You will make only smart investments as you become more comfortable and confident.

5. Consistently Monitor Your Investments

Don’t just set it and forget it! You must regularly monitor your investments to ensure they are performing as expected. Track the growth of your investments and make adjustments as needed.

6. Avoid Exaggerating Your Lifestyle

When you are becoming financially independent, it’s advisable to live within your means. Avoid making any major purchases or changes to your lifestyle until you are sure you can afford them.

7. Make Retirement Plans

Retirement planning is a critical part of your financial freedom. Start early by contributing to a retirement account and speaking with a financial advisor. Having a plan in place will ensure you are prepared for your golden years.

The winds of change are blowing. Women of India are more driven than ever to save, invest and take charge of their lives. This article aims to show you how to be financially independent in India and make decisions that enable you to accomplish your life’s objectives. Hopefully, it was successful in accomplishing that.