37% women not sure if they have enough money for emergency: Finsafe India women’s survey

International Women’s Day: Nearly 45 percent of the women now take independent financial decisions, but most point to a lack of knowledge and proper planning. No wonder then that 66 percent of women surveyed aren’t confident if all their financial goals would be met, says a Finsafe survey of 865 women across India.

Women constitute 37 percent of the labour force in India according to the Periodic Labour Force Survey Annual Report 2022-23 from the Ministry of Statistics. While women are becoming economically independent, financial security and independence remain a dream for most. A study by Finsafe India, a financial education company, which had 865 women professionals in the organised sector as respondents, pointsto women being unsure about meeting financial goals and being possibly unprepared to deal with health expenses in the case of a job loss. The survey was designed based on the firm’s interactions with women investors.

The three big financial challenges

Only 13 percent of respondents said the do not have financial worries. For the vast majority,multiple financial worries on basic finances were stress points. These ranged from not beingable to save enough to not being sure if they had enough for financial needs and goals, andemergencies, medical or otherwise.

With expenses and goal values constantly rising, putting aside money is proving challenging.No wonder 66 percent of the women surveyed said they were not sure of meeting goals and37 percent felt they may not be able to meet emergency expenses.

Leaving money management to a male member ofthe family and not taking formal financial advice could be a significant issue. Many women do not realise that their hard-earned money may be used for purposes they are not informed of or may not have been invested based on their own expectations. It was heartwarming to note that 45 percent of women take financial decisions independently and 7 percent have a financial advisor.

Women want to invest but are deterred by many factors

Taking decisions independently doesn’t mean women do not face challenges while investing. Given the lack of attention given to financial literacy in their growing years and money being a taboo topic for women in many households, it is not surprising that 60 percent of those surveyed cited lack of knowledge as a stumbling block. Women are known to be conservative investors and the survey also pointed to the same with 52 percent saying they were scared of making losses.

Starting trouble is but natural with so much of information, misinformation and disinformation all around and so many different opinions available within one’s circles, coupled with the lack of financial knowledge. All this adds up to 39 percent of the respondents saying they had little idea of where and how to begin their financial journey.

Where do women invest?

It is encouraging that women are becoming less risk-averse and are veering towards equities, with 35 percent putting some of their money in mutual funds and 11 percent directly trading in equities as their largest investment, even though 42 percent still preferred traditional products like fixed deposits and insurance policies, which are considered safer options.

The increasing tendency to look at equities as an investment option is borne out by the fact that 64 percent of those in the study said they are considering investing in mutual funds and 58 percent said they would like to learn more about investing in stocks. With the markets booming and continuous chatter on social media, it is little surprise that 43 percent said they wanted to get into the share market.

The gaps in financial planning

While interest in equities has risen, women need to also think about the basics. Some 47 percent of the women surveyed said they had not thought about how they would continue health insurance coverage in the absence of an employee policy were they to be out of a job. Only 28 percent had adequate external cover and the balance 24 percent said they would depend on their partner in this situation.

Financial advice is much needed

The pressing need for good financial advice cannot be understated. Thankfully, 66 percent of the women surveyed said they would like to tap a financial advisor to handhold them in their financial journey. The problem they face is in finding an advisor who can understand them, talk to them in the language they understand and do not make them feel ignorant.

What should women do?

It is interesting to see women moving ahead with their investments in keeping with the times. However, they need to have basics like adequate insurance covers and a structured financial plan in place to be financially secure. A lot of education and handholding is required to help women lead better financial lives. There is enough misinformation all around—on social media, and from family, friends and colleagues. Stakeholders like the regulators, financial services companies and advisors should focus on financial literacy along with access to adequate data for women to make better financial decisions and inspire financial inclusion.

Happy Women’s Day!

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