Working Womens Financial Laundry List

The Working Woman’s Financial Laundry List

When you are a professional working woman, everyone assumes that you are savvy about money matters. Even if you are, for most, taking care of money just means one more ball in the air to juggle. Instead, we are happy to hand over charge to our male counterparts. Many working women have asked if they could have a laundry list of things that they must do, rather than a full scale financial plan. So, one working woman to another, here is mine:

Know what you’re worth-coz you’re worth it!!

Hina, who heads sales in a leading international pharmaceutical company for over 20 years, with a healthy salary, sheepishly admits that she had no idea what her CTC (Cost To Company) was. It was only last year, when she decided to take a sabbatical to help her ailing father that she took the time to find out simple details like her earning before tax and other benefits the company offered. Thanks to this, she found out that the company’s health policy covered her father’s illness. This saved her Rs 2 lacs in medical bills. She also realized that she was being under-paid almost 25% vs her male colleagues.

Figure out, over and above your salary what benefits your company offers. If you are being underpaid, at least be aware of it. Along with this, make a list of all the investments you have in your name. Don’t leave out anything -- shares, PPF, FDs, Bonds, Post office schemes, Property, Gold coins, art. This is your starting point. Do this once a year! It helps you understand whether you are headed in the right direction.

Have your own bank account and investments

A classmate who trustingly opened joint bank accounts and joint investments with her husband, found he was cheating on her. Seven years later after a divorce and court order, she is still unable to access her investments. Her ex will not sign off on the forms which will allow her to redeem or sell her mutual funds and shares.

Life is uncertain. Open a bank account with your name first. Let all your income go into this account. Make all your investments from this account, again with your name first. Map all redemptions into the same account. Only then spend or transfer the balance money to other accounts. If you have to have a second holder, use the EITHER OR SURVIVOR option where possible. Be aware that DEMAT accounts held in joint names require the signatures of all holders. Set up sms alerts to make sure that you know if anyone is misusing your money.

List your “kharcha”

Here is a game for you -- write down on a piece of paper what you THINK you spend in a month. Then, make a proper list--include your groceries, cell phone bill, yoga, gym, life insurance premiums, mediclaim, holidays, books, eating out, rent, EMI’s other loans….. everything that you spend money on.  Chances are pretty high that your guesstimate will be way lower than your detailed list--maybe even 50% lower. After this little game, you’ll probably go eat at Shiv Sagar more often!

Pay yourself FIRST

The receptionist at my old firm, Maggie, on a salary of Rs. 5,000/- put away Rs 500 on the 8^th of every month into a PPF account. Each year she topped this up with her bonus amount. Every year, with her salary increment, she increased her monthly PPF investment.  Today she owns two one-bedroom flats in Vasai -- the down payments for both came from this very same PPF account.

It’s not rocket science. If you’ve listed all your expenses AND you know how much you are making after tax, then you know how much you can spare. Even if you move it from your savings account into a fixed deposit, it’s a start. This simple step, will help you build wealth, almost effortlessly. Tuck the difference away EVERY MONTH

Protect Yourself First

Nivedita was pregnant with her second son when her fit, sporty, husband died at the age of 38. After this tragic, life-changing event, Nivedita found herself literally on the street, with just 700-odd rupees. Suresh had forgotten to pay his life insurance premiums. Suresh had not even changed the nominee on his policies from his mom to his wife. There was no will. His mother, who disliked her daughter-in-law, took advantage of the situation and took over the lovely bungalow that they lived in.

Create reminders. LIC premium dates, mediclaim premium dates, FD renewal dates and advance tax dates. For yourself and others in the family. Make a will and make sure your husband and father do the same.