Indian women always have been the ones who quietly kept putting aside small amounts for the family’s future needs. They continue to do so even when without a direct income. More often this small saving is as a kitty for emergencies or the family’s needs but rarely for herself.
Men have been the primary earners and investors, traditionally, but women are taking up the baton fast. That means the investment options have also evolved to cater to the needs of this new age investor.
If you are also looking for investment options to safely park your savings and enjoy long-term growth, here’s a two-step process to help you:
- Understand the reasons for investments (define investment objectives)
- List the features you need in the ideal investment option
Reasons for Investment or Types of Financial Goals
1. Financial Independence
Financial independence is important for any adult, and so it is for women as well. It allows you to contribute to the welfare of your family as well as to the society directly. With your savings and wealth, you can implement your ideas and lead your life more independently.
You may have certain goals in life, for example, buying a house or sending your child to Ivy League colleges or career-building hobby. Your investments will also enable you to achieve more financial goals for your child, family and, more importantly, for yourself.
2. Retirement Fund
Retirement savings are important for everyone. As this is one stage which you cannot avoid in life. Having enough wealth to take care of your expenses in this stage is crucial for you, more so if you are a woman.
Women tend to live longer than men so they have to ensure that they have enough to take care of themselves till the end.
3. Learn About Investment & Insurance
When you manage your money yourself, you gain valuable experience with the financial market and investment options. This experience will help you manage your money and your family’s wealth better in future.
Such knowledge is extremely useful in case of emergencies when you suddenly become the primary member of the family. For example, in the case of sudden hospitalization, accident or death of the spouse.
Your investments too should help you take care of such situations financially.
So with all these factors, you need specific saving plans. Following are the key features you will need in a good savings plan for yourself:
4. Easy to Manage Online
The current environment has limited our stepping out and hence the saving plan should be such that one should be able to manage it online without having travel anywhere. These days most investments can also be managed through apps.
5. Small Monthly Outlays
Taking huge investments are good but with uncertain times it is prudent to plan such that it should give you the flexibility of managing it through small outlays without causing major strain on your monthly home budgets. A 20-30% is an ideal savings outlay per month.
6. Automate the Investment
Many of us have acquired the habit of savings through the way our families bought us up. But sometimes we lack the time and end up missing the instalments.
Savings should never be out of what is left as balance after allocation of all monthly expenses. But it should be along with all other allocations and only then can you develop a serious attitude towards it.
If your savings plan allows for auto-debit, you can set up a date and your investment will continue whether you remember or not.
7. Safety of Returns
One always needs a Savings plan that will ensure that the principal doesn’t get eroded through the years. Unless you are comfortable with aggressive market-linked investments, you need such investment where your money can stay safe.
Safe investments will let you focus on your profession and family, while your money grows steadily.
8. Goal Protection Option
You already have plenty of financial goals, some of which are very important for your family. If you are saving to meet these goals, wouldn’t it be great if your savings plan can offer to protect the goal from any mishaps?
Few safe investment plans such as Guaranteed Savings Plan from Canara HSBC OBC Life offer goal protection option. This plan offers to cover for your goal in the case of your early demise.
Upon the death of the investor, the investment part of the plan continues as if you are still alive and investing in it.
At maturity, your family will receive the sum you intended for them in the beginning. Thus, not only safeguarding your invested money but also the ultimate objective of your investment.
9. Provides a Life Cover
Even if you have put aside your career and now managing your household full time, your contribution to the family can be quantified. In your absence the family will have to bank on the alternative services which will cost them, affecting their wealth.
Thus, if your savings plan can provide your family with a lump sum in your absence, you will also keep them financially safe.
Women, often are covered under Mediclaim floater policies but lack adequate cover for critical illnesses. One should look for such contingencies through the Savings Plan. The guaranteed savings plan will provide a lump sum to your family immediately upon your death.
10. Tax Benefits
The ideal savings plans must also make for good tax-saving instruments. The guaranteed savings plan from Canara HSBC OBC Life is a life insurance plan. Meaning all the investments in the plan will help you save tax. The invested money is tax-deductible up to Rs. 1.5 lakhs under section 80c of the Indian Income Tax Act, 1961.
Maturity and death benefits of the savings plan are also tax-exempt under section 10(10D). Thus, once you start investing in this plan you can set aside your worries about tax liabilities from this investment.
The market is flooded with several saving investment plans, and every plan has its risks associated with it. With the varying risk-return profile of all investment options, putting your savings in ad hoc investment is not a good idea.
Select an investment plan which not only caters to your future financial needs but also makes your life easier now.