In today’s world, it is very important for women to be financially independent. Financial freedom enhances a woman’s self-morale and confidence level. A sound financial plan is the foundation for financial independence, so that she can fulfill all her dreams without relying on anyone else. Financial needs of a woman are unique. Most women have to take a prolonged leave or absence from their career due to pregnancy, kids, ailing parents and various other reasons. Such complications often leaves a woman financially as well as emotionally drained. Although the habit of saving comes naturally to women, it is necessary to have a disciplined approach towards savings and investment planning. Take charge of your finances by following these simple tips for planning your finances:-
- Be clear about your financial objectives: – Setting realistic and clear financial goals is the first step of financial planning. Whether you want to buy a new home or car, travel the world, save up for the education or marriage of the children, everything would require long term planning. Furthermore, defining the amount of money required along with a timeline is also very important, so that you can choose the investment instruments accordingly.
- Track your expenses: – Tracking expenses is vital to financial planning. Many women end up spending more than necessary, as they don’t track their expenditure. Plan out the budget of your daily requirements and stay within the limits. Setting a savings goal is also equally important. You can set a savings goals as 15% or 25% of your monthly income. Although sticking to the plan may seem difficult at times, this strategy will surely pay off in the long run.
- Start investing: – Once you start to save up some money, it becomes important to use it in the right manner. Invest in tax saving investment plans such as mutual funds to multiply your savings. Invest in short term and long term investment plans according to your financial goals.
- Get Insurance: – Insurance is an essential component of any financial plan. What would happen to the children if the worst were to occur? Ideally both the spouses should have life insurance to secure the future of the children. Also, taking up a disability policy is also a good idea because disability is twice as likely as death.
- Save taxes: – How can you save enough money, if taxes are cutting into your savings? Saving tax is an essential component of financial planning. Invest in tax saving financial instruments that provides the dual benefits of tax savings cum investment. Consider investing in tax saving instruments such as life insurance, health insurance, mutual funds and ULIPs.