Long back on a road trip to Rajasthan, a close family friend said, “you drive like a man” …it took me sometime to understand that he intended to complement me. I don't know if women are good drivers or not, but I know of many women who some prefer being chauffeured around and then there are some who are even discouraged to be on the steering wheel on the pretext, “what’s the need?”

Something similar is the case when it comes to structured money management and investments.

Women are adept at managing household finances. They can typically not only work with a tight household budget, but also save a bit. While many women have a keen sense of finance, in most cases, they take a backseat when it comes to avenues for growing money and making investment-related decisions. 

Today, while the new-age woman is career conscious and considered ‘financially empowered,’ the reality is not quite the same. Financial empowerment isn’t just about earning money. A financially empowered person is both informed and skilled. They understand their money dynamics, make financial decisions, and can access resources to help reach their goals. Going by these criteria, most women don’t fall under the category of being financially empowered.

There are any number of reasons why women tend to let the men in the family take financial decisions, but there are equal and even more compelling reasons as to why it shouldn't be the case. It is important for women to be truly ‘financially empowered.’ A friend who is a management consultant in New Delhi once said, “We were never taught to look at money as an area of influence as you would be expected to be married and would live off what the other one makes. Also, if you commit financially to a plan, there’s no way to know whether you would continue to work post-marriage or once you have kids and if there would be ‘willingness’ to pay your dues in case you quit working.”

Why should women learn to manage money?

The WHO statistics suggest that women outlive men by six to eight years. This means, at some point in their lives, most women will be responsible for managing finances on their own. My uncle expired recently and my aunt who is 78 years old, a retired lecturer of economics, didn't even have the ATM password with her. Their only child is working in the U.S.

Careers for women are like a hurdle race. The constant juggling between different roles can be exhausting. Women end up spending 15 percent of their working years outside the workforce to take care of children and the elderly, as per the Women’s Institute for a Secure Retirement and National Center for Women’s Retirement Research. They are often faced with a tough situation to choose or prioritize between work and household commitments. Many women aren’t able to continue with their jobs, and of those who do manage to achieve a work-life balance, there is the problem of gender pay gap. In developed nations such as the US, women earn roughly 81 cents to every dollar earned by men. In India, this gap is between 20 percent and 30 percent for women in skilled and highly skilled careers according to Monster Income Survey.

Situations can get challenging, especially if one faces a divorce (divorce rates have been on the rise) or becomes a widow at a young age. Such difficult times can cause immense emotional and financial stress.

The percentage of single women above 40 years of age is rising too, which necessitates them to have retirement plans and a well laid out investment path.

According to a Citibank survey, 57 percent of divorced couples cited money problems as the primary reason for ending their marriage. In other cases, women just aren’t interested in dealing with money matters since they come across as being complex. I met a CMO of a mutual fund house two years back, and he said that his wife who did her MBA with him wasn't interested in money matters. He sends an email to her every quarter just to keep her updated with passwords and other investment details and has asked his wife not to delete any of those emails. At the same time, I have a client who manages all investments for her husband and has been the force behind her young kids beginning investing from Day 1 of getting their jobs.

Overall, it's a mixed scenario. A married professional said, “Although earning, I’m dependent on my spouse for money-related issues.” She added, “Like me, many women feel that it’s not their forte to think or be open about financial issues ...”

Money management checklist

-Start discussing money matters. Women are often called chatty, so let’s get talking about money management.

-Build yourself a contingency fund when you start working. This corpus can come in very handy especially during a career break, to be with kids or for other responsibilities. Many educated and qualified women have to give up careers after few years, and a decent corpus can be very helpful to start an entrepreneurial venture. Some of the options that can be considered for saving towards contingencies and the near term include, a recurring deposit, fixed deposit and a liquid mutual fund.

-During your work years, invest in financial instruments such as Public Provident Fund (PPF) and EPF. Plan for your retirement and start allocating some amount to equity mutual funds from the first salary onwards.

-Do get yourself a health insurance and as you age, add a critical illness cover to it.

-A term life insurance is a must if you have any liabilities such as a home loan or dependents such as parents and kids.

-Explore the option of buying gold in electronic form.

-Remember that it doesn't need to be complicated to be good. Keep your investment portfolio simple. Not managing personal finance should be out of a women’s choice and not because she finds herself incapable of making financial decisions.