How important is investing for women?
As per a survey conducted by an Indian financial firm, DSP Winvestor Pulse, in 2019, only one-third of women take investment decisions by themselves1. This speaks volumes about how little women are exposed to the world of investing. Surprisingly, even as many women are becoming financially independent, the idea of investing in stocks, bonds, or even real estate is still often linked to the men of the family. The concept of aggressive investing continues to be absent in the lives of many working women and they prefer saving for their future in bank accounts or investing in jewellery like gold.
But in these times of sky-rocketing inflation and unexpected economic downturns, the need for a well-planned and calculated investment strategy is crucial for everyone. Here’s why women need to invest more:
Saving for retirement
Unless an individual earns an exorbitant salary from the very start and can save up more than half of their paycheck, it is practically impossible to save up for retirement without investing. Rising medical costs, inflating higher education expenses, overpriced commodities, etc., can make it difficult to sustain a comfortable lifestyle on savings alone. It is essential to have an investment plan that can grow your money over the course of time and offer high returns to counter inflation.
Overcoming the salary gap
There exists a very alarming gender wage gap across industries around the world. Women are sometimes paid less in comparison to men. These low numbers can amount to a sizeable amount of funds over a period of time. Although many women are fighting tirelessly to overcome pay parity and workplace discrimination, it may take time for things to change. Investing can be extremely useful for women to bridge this gap. For example, investing in a suitable life insurance plan can help women leave behind a legacy for their loved ones. Retirement annuity plans are another excellent investment tool that can guarantee~ women a safe and secure source of revenue in retirement.
Battling fewer work opportunities
Despite recent changes in ideologies and conservative mindsets, women are still seen as the primary caregiver of the house. When it comes to raising children, it is generally the mother who is encouraged to leave her job, work as a freelancer, or put in less number of hours as compared to the father. Although many companies offer paid maternity leaves, women can lose out on substantial opportunities and promotions because of the time they take off to accommodate pregnancy and childbirth. Pension Accounts like Employer Provident Fund or EPF can be a smart way to save. But because many women may not continue a full-time job for the rest of their lives, it makes sense to also invest in mutual funds, SIPs, or at the very least a Public Provident Fund or PPF to make up for the lost time.
Ensuring financial security
A discussion on the economic security of women is incomplete without bringing in real estate. Traditionally, ancestral family properties in our country are passed down to sons and not to daughters.
Investing in real estate is a good investment decision that women can take to secure their future. The ownership of a house not only empowers women financially but also offers them peace of mind and secures the future interests of their children.
Planning for longer life spans
Science suggests that women tend to live longer than men. Life expectancy for an individual can depend on many factors like family history, existing medical conditions, and more. Nevertheless, one cannot overlook these facts. Women must proactively prepare for a long life and make sure that they have enough funds to cover their expenses. While savings can offer partial monetary relief for a few years, strategic investments can provide better rates of return and ensure that the golden years of an individual’s life are spent blissfully and comfortably. For example, Unit Linked Insurance Plans not only provide financial coverage during difficult times but also reward you with attractive returns on investments.
To sum it up
Despite working and earning, many women in India are still dependent on men. Sometimes they leave the workforce sooner because of personal commitments, other times they fall back on financial goals because of lower remuneration and unequal work opportunities. While the society around women changes and makes way for a more progressive work culture, women also need to adapt to investing in their plans.