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Business News/ Money / Calculators/  Moms, let’s plan finances

Moms, let’s plan finances

Dear Mom, gift yourself financial freedom by taking stock of your money and bolster financial security for yourself and your child

Financial planners say that in reality women are better money managers.Premium
Financial planners say that in reality women are better money managers.

Mumbai: Motherhood can change your life forever. It also comes with an added responsibility of managing your money so that you can provide everything your child needs. Many tend to stay away from money management because they find it complex to understand it or merely because they have someone else managing it.

However, financial planners say that in reality women are better money managers. They also need to be more interested in it owing to two main reasons—they tend to take a break during the most important period of their career for childbirth and they tend to outlive the men.

According to Avtar, a diversity and inclusion consulting firm, between 2003 and 2010, more than 48% of employed women under 30 years of age dropped out of the workforce owing to maternity and childcare. In a national survey by LinkedIn, 60% Indian women said they will slow down their careers once they have children.

We spoke to mothers who manage their money and have been able to live stress-free and with total confidence.

Bangalore-based Charulatha Varadarajan, 37, programme manager, Intel Technology India Pvt Ltd, has been handling her finances because her husband was never inclined to it. “Earlier, I used to invest only a little in real estate and for tax benefit. But closer to my pregnancy, which was complicated, I realised that I had money only for year and most savings had depleted," said Varadarajan, mother of five-year-old twins, Elamara and Elakiya.

She then felt real estate was not required and also never expected a medical emergency. “My children were born preterm owing to which there was an added cost. Also, since they were twins, I had to go on a long break from work and we were completely out of money," said Varadarajan.

That was the time when she realized that she should be diligent about money. Initially, she went through blogs. She used to invest in mutual funds, but not consistently. By 2014, she started investing on her own in direct mutual funds. After three years, she approached a financial planner, Melvin Joseph.

“All the baggage of investing in traditional products went away," she said. Her investment portfolio has now shifted from real estate, gold and fixed deposit to equity mutual funds, liquid funds, direct stocks and some fixed deposits. She now has a separate medical insurance other than the one provided by her company, term plan, emergency fund, investment for kids’ education and her retirement.

Bangalore-based Sanchayita Mukherjee, 45, a school teacher, got involved in her finances after her mother passed away. “I was totally ignorant about finances. As I was the only child, all investments and money came on me. Around that time, my husband put me in touch with Joseph, my now financial planner," said Mukherjee.

As she had to take interest in financial planning, she learnt about various investment avenues. “I realised that fixed deposits are not the best option. Money should be put in equity and debt depending on your risk appetite," said Mukherjee, who has a 19-year-old daughter, Rachaita.

She has set aside money for her daughter’s marriage, money to meet medical expenses or any unforeseen circumstances and retirement. Both Varadarajan and Mukherjee have shifted from conservative products such as fixed deposits to equity and debt funds.

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Published: 19 May 2018, 10:08 AM IST
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