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6 reasons why women need to be financially independent - Outside View by PersonalFN
6 reasons why women need to be financially independent

Financial independence in simple terms is the ability to earn a living that enables you to pay for your expenses. In today's era, it is important for every individual to be financially independent - be it men or women. A large number of women in India are efficient home-makers but career takes a back seat for many of them when they enter motherhood or when the domestic needs of their household are more pressing. It is important to understand that at present; quite many women have to live their retired lives alone due to their longer life spans or separation from their spouse. Hence, women might have to handle their financial situation alone at some point of their lives.

The following points will discuss about why financial independence is important among women

  • In times of emergencies: Today, nothing is certain - be it jobs or life. You must understand that if only the husband is the bread earner, with the wife and kids being dependent on him, then there is reason to worry for the family. This is because, if the husband loses his job or is unable to work for some reason, then he might have to take loans or extinguish all the contingency reserves of the family, till he finds another job. Similarly, in case of an unfortunate demise of the breadwinner, other family members might have to suffer financial setbacks (assuming there is inadequate insurance). In all of the above cases, a lot of situations could have been managed without too much financial stress if the lady of the house was also financially independent.

  • To meet the rising cost of living: Inflation, as we all know, has risen noticeably in the last few decades. To own a decent home, send your kids to a good school and live an above average standard of living has become very difficult. Hence, if women are financially independent they can not only contribute to the daily expenses of the household, but also help to meet the family's financial goals.

  • For raising their self-morale: Financially independent people are capable of taking their own decisions and don't have to depend on anybody. This increases their self-respect and makes them more confident to face any kind of situations in life. Moreover, being individuals, a lot many women might be having some aspirations and dreams, but for the fulfillment of which they have to depend on their parents or spouses. Being financially independent, will enable them to self-sufficiently fulfill their wishes such as doing a course for enhancing their skill-sets, going for a trip with friends, buying things that they desire and so on.

  • To stop feeling helpless: It is a sad fact that a lot of women in the world are victims of domestic violence or suppression by their family members. However, due to financial dependency, they continue to tolerate injustice and crime. Therefore, it is extremely important that every woman becomes financially independent so that they never have to feel helpless in life.

  • To become a role-model: A woman who is capable of standing on her own feet and has an opinion of her own is a role-model and a source of inspiration for other women in the society. She motivates others to stand tall with dignity and say no to violence. Moreover, children learn from what they see. If kids see that their mothers are financially independent, they will also understand the value of money and be inspired to be self-sufficient in life when they grow up.

  • For benefitting the country: If most women in our country start earning, they will become consumers and start spending money, thereby boosting the Gross Domestic Product (GDP) of the country. Also, taxes paid by them will increase the Government revenue and can be used for the welfare of the people. Moreover, increase in the working population will also lead to an increase in the money donated to charities, thereby resulting in the welfare of the society at large.
Hence, you see, it is important for all women - be it married, single, separated, widowed or divorced to be financially independent. However, remember that financial independence cannot be regarded the same as financial security. A monthly pay cheque in your bank account alone cannot render you capable of meeting all your financial goals. It is how you plan and manage your finances which will result in fruition of goals later in life.

PersonalFN is a Mumbai based personal finance firm offering Financial Planning and Mutual Fund Research services.

The views mentioned above are of the author only. Data and charts, if used, in the article have been sourced from available information and have not been authenticated by any statutory authority. The author and Equitymaster do not claim it to be accurate nor accept any responsibility for the same. The views constitute only the opinions and do not constitute any guidelines or recommendation on any course of action to be followed by the reader. Please read the detailed Terms of Use of the web site.


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