How to kickstart your financial independence

“Women all over the country had been accumulating cash that they had saved for themselves from household budgets, by haggling with vegetable sellers, tailors, grocers, and assorted traders. Years of stashing in whatever little cash gifts they received from relatives during festival times and years of tucking away the change they found in the pants that they washed every day, however, suddenly they were left with no option but to deposit the amount in the denomination of Rs 500 and Rs 1000 notes in the banks on account of Demonetisation scheme 2016, (as) these notes were no more legal tenders.”

That’s the Income Tax Appellate Tribunal acknowledging the astuteness, resourcefulness, and patience of Indian women when it comes to saving money and the adverse impact demonetisation has had on it. In its recent verdict, the tribunal exempted cash deposits of up to Rs 2,50,000 made by housewives from income tax scrutiny. Per the tribunal, the amount deposited by the appellant during this period cannot be considered as income, setting a precedent for all such further judgments.

Estimating Real Income

But what if we were to calculate the real income of home-makers in the country? It is no secret that women bear the brunt of unpaid labour in our country. As per the 2011 Indian census, household work happened to be the main occupation of almost 160 million women, in contrast to just 5.79 million men who state household management to be their primary job.

Consequently, men spent only about 97 minutes per day performing unpaid domestic services, while the figure stood at almost 300 minutes for women, per a 2019 NSS Time Use Survey..

COVID-19 certainly has exacerbated this, but the trends have been visible in the past as well. Globally, women take over 75% of unpaid caregiving labour. A 2018 report by ILO (International Labour Organisation) also highlighted that half the female population (50%) in both urban and rural areas were out of the workforce and engaged in unpaid caregiving.

And with women finding it harder to get back to the workplace as their global unemployment rate inches to 5 percent in the shadow of the receding pandemic, this figure is here to stay. Undoing years of work to bridge the gender inequality gap, the past year also saw India slipping to the 140th rank, out of 156 countries in the World Economic Forum’s Global Gender Gap Report 2021.

Standing Tall

While many would argue that the love, affection, and care of a mother can have no price tags, the idea here is to simply value the time and worth of the home-makers in your life. And helping them assert their financial confidence and independence to that measure is a great start!

The first step, of course, is to prepare a budget. Much like budgeting the household expenditure, women can start off with a list of goals they would want to achieve, their investment tenure, and their risk appetite.

After setting aside an investible surplus that is available at a regular interval, another important thing to strike off the list is to have inclusive financial conversations with the spouse. And investing can begin with a SIP (Systematic Investment Plan) as low as Rs 500 per month.

For the more adventurous, day-trading is also a viable option. While less than 10% of day-traders in India are women, as per an industry estimate, the number is surely growing by leaps and bounds. In fact, last year, Zerodha reported more than 2 lakh women registering on their platform.

Shradha Nanchahil, a Ludhiana-based professional trader, says that women make for better traders than men, thanks to their emotional control and consistency.

And if trading is off the charts, there are always ETFs (Exchange Traded Funds) one can start off with. When you can start investing with the same ease as finding your favorite recipe videos or embarrassing images of your children, why wait?

Nema Chhaya Buch, a Pune-based independent financial strategist, stresses the importance of starting off small and then incrementally upping the investment game. “Fixed Deposits is a safe, easy starting point. I would suggest investing in gold bonds or funds instead of holding gold as a physical asset. Index funds are a great way to begin your market journey.”