When I turned 37, my life changed. I found myself financially alone and ill-equipped to provide for my young daughter. Despite having parents who were willing to support me until I could get back up on my feet again, every day was and still is an uphill battle with my job and money.
As I grappled with financial survival, my money mistakes started unfolding one by one. I knew nothing about finance and this deepened the fear and horror of an unknown situation.
I then realized that these mistakes are not technical. They had everything to do with upbringing in India and the career and money messages we women receive in this country. Here’s everything I did wrong.
1. Let the men handle all the finances
Both my parents worked in full-time jobs. Even in the 1990s, my father had an excellent financial sense. A self-made man who came from no money at all, he would save smartly and even invested money in the form of diverse long-term plans for my education.
Here’s the funny part – we never talked about money. I didn’t ask, and my parents never discussed the issue. Growing up, I always assumed that the man in the house was in charge of money and handled everything. When I got married, my husband insisted that I take over a significant portion of the money leadership in the house but I insisted on him doing everything. His advice was spot-on – what will you do if I am not around and you need to take care of the money?
Here’s what will shock you – I didn’t have my own bank account until I was 28, didn’t know how to deposit money and knew nothing about money whatsoever. Today, I am slowly inching towards saving a decent amount each month, even as my female friends invest in real estate and even Microsoft!
What we can do: Talk about money with your children and your spouse. Control your own money, build it, save for your future and explore finance. Keep that one-page financial plan ready. Be open about financial worries.
2. Blew up lakhs on a wedding
While I respect personal financial choices, one of the biggest mistakes I made was to let my parents save and spend lakhs of money on my wedding. Of course, it was a special day, the happiest day of my life but my husband and I didn’t need money to validate that. When it comes to Indian weddings in particular, many a time, there is a sense of pressure to live up to our peers – jewellery, expensive return gifts, five-star hotel receptions and food that the bride and groom may not enjoy because of all the circulating we have to do!
I understand why women or men who want to spend a lot of money on a wedding but a time may come, when you are in your late 30s, when you want to build something or do something. Currently, I struggle with monthly expenses and a bank balance that does not inch past the four-digit mark at the end of the month, even as I have dreams of starting a business but am unable to do so. How I wish I had that corpus of money now!
What we can do: Reassess and reevaluate the value of experiences over possessions. Looking back at my wedding, it wasn’t the huge pasta counter or the splendid décor that I cherished. The little moments were the ones I cherished – when my husband soothed my burning finger when I accidentally got burned by the homam fire or our jokes about not knowing who half the guests were. Those are the moments that will stay with you forever, the ones that no photographer can capture.
3. Never saved or built a safety net
Until recently, I only had a few thousand rupees in my bank account. Does my financial illiteracy shock you? It did shock me, especially when I realized how intelligent my female peers were. But necessity is the mother of invention. I started reading about finance and learned so many things that I didn’t know. For instance, I was surprised to learn that people spend more on their kids than on their own retirement. What if this current scenario repeats when I am older? I may not be physically fit for a job then.
Before this, I had never secured my money or built a financial safety net for myself. Now, instead of fear, I feel an odd sense of excitement about building my money.
What we can do: Even if you are well provided for, don’t lose any time in preserving and growing your own money for the future. Start saving, investing and building emergency funds and saving up for your retirement.
4. Thought I didn’t have the brain for finance
To me, the world of finance sounded like a testosterone-fuelled place, but the more I read about finance, the more I realize that there are many women who do very well in the field. Another setback is that we women often tend to fear investing and think that we don’t have the brain for finance when in fact we do. According to this report by Terrance Odean and Brad Barber, women make better investors than men and outperformed men annually by about 1%.
What we can do: Start investing and keep at it. Says a female friend, “It took me 20 years to perfect the art of investing and gain confidence but I did it. Today, most of my savings are divided between land, apartments, mutual funds, savings bonds, some stocks, PPF, and some cash in fixed deposits. It’s like a bouquet. When one is down, others are up and they balance out. It took me years to get confident, but now I plan that I need an ROI of 15% a year on an average. Confidence is key.” Her advice to women who want to start investing seriously? “My advice would be to start early. Get your teenagers to understand money and start taking it seriously. But remember, it’s never too late to start at all.”
5. Assumed that I didn’t deserve more money
When I was a kid, my uncle gave me and my group of cousins an interesting project. We had to clean his home office and in return, he would pay us for it. When the chores were done and we lined up for our payment (nothing fancy but even these baubles excited us as kids), he paid my older cousins more while I got only a little sum because I was the youngest. I passionately argued my case with him, telling him that it is unfair that he is giving me less for the same amount of work and even specified a price that had the best chance of conversion. I ended up making more than the others!
What happened to this girl who stood up for her work ethic and talent? She got lost to career and money messages that insisted that women had to be secondary consultants in everything, including their own lives!
What to do: Believe in your worth. Don’t shy away from finance just because you are scared of numbers. Perfect the art of the perfect asking price (it comes with practice). And say this to yourself everyday- “I will stop doubting myself.”
The above blog is by Shweta Sharan