Women today are certainly stronger than men on the financial inclusion front. The Pradhan Mantri Jan Dhan Yojana launched by Prime Minister Narendra Modi on 28th August 2014 said that every household in India must have access to banking and insurance services or financial inclusion. It also paved way for households in India to focus on having a basic savings bank account.
Data from InterMedia’s Financial Inclusion Insights (FII) research programme found that the PMJDY scheme increased financial inclusion among Indian adults by 20% from the year 2014-15. But, the rate of financial inclusion for Indian women increased by 24% in this time period, compared with an increase of just 14% among men. Clearly, the PMJDY scheme gave women access to financial services and contributed in a big way in making women financially independent.
So how did the PMJDY scheme make women financially independent? The PMJDY scheme gave women the right to own and operate a savings bank account. The next logical step would be any money saved would go right into the PMJDY savings bank account, promoting Financial Independence in the Modern Woman.
THE BIG GAP
Although working women today are earning equivalent of their male counterparts and attaining financial independence, there certainly is the question of whether the modern day woman is handling her finances right or if there is a need for improvement.
Although data may lead one to believe that all is well, the modern day woman is certainly not managing her finances right. Interestingly, a study conducted by Standard and Poor a few years ago found that 80% of Indian Women were financially illiterate.
Women in India even working women, are reluctant to manage their own finances. They leave this job to their father or husband.
Many working women are reluctant to involve in financial planning, retirement planning, investment planning and even children's education planning, leaving this all important job to their spouse.
Solution? Fortunately, there is and the modern woman needs to grab it with both hands.
1. Women must be aware of the financial situation of the family
Many working women do not bother understanding finance or making investment decisions. This can be pretty dangerous if circumstances force them to manage finances.
Women who don't understand finance can become victims of fraudsters and unscrupulous people.
The modern woman must be aware of the financial and investment decisions made by her family. She should know the family investments, home loan or other loans availed.
One way to solve this problem.... The Women in the family must be made responsible for achieving financial goals. This will force them to understand at least basic finance, so that they can contribute to family financial goals…..
One of the best ways for women to attain financial literacy is by reading books, magazines, newspapers and online financial content which explains the basics of financial and investment planning among others. This helps women understand the basics of finance and prepares them for financial emergencies.
2. Preparing for financial emergencies
An emergency fund is the perfect solution in terms of a financial emergency. Women must have at least 6 months of living expenses post marriage as an emergency fund.
Men must also share the responsibility of teaching their wives, daughters and sisters the the importance of an emergency fund and if she is working, contribute to this fund.
Another very important matter, the modern woman must have a financial advisor or if her husband has a financial adviser, she should have the requisite contact details. In case of a financial emergency, a financial advisor can be a big blessing.
3. Retirement planning
Women have a higher life expectancy than men. Studies conducted by a reputed Agency show the average life expectancy for men at birth to be 68 years and 4 months, while for women it is 72 years and 8 months.
Also, the average woman is around 3-4 years younger than her spouse.
Many men in India plan for retirement, but do not bother to do any retirement planning for their spouse, who could outlive them. The modern working woman must plan for her retirement or she could face financial hardship, in her old age.
Be Wise, Get Rich
C.S. Sudheer is the Founder & CEO of IndianMoney.com