Retire like a Queen

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As an educated and independent woman, being a rockstar at work is just half the battle won. The other half is in being smart and prudent about your hard-earned money. However, we’re not saying that you need to give up everything you love and save up for the future.  

Small but sensible steps can help you grow your money, achieve your financial goals, and retire like a queen, while still indulging in the occasional shopping spree or international holiday or whatever else you may fancy.  

Money Tips that can help

1. Allocate a Budget 

Based on your monthly/annual income, draw up a personalized budget based on your goals and the time frames within which you want to achieve them. A good way to start is by following the 50-30-20 rule. On receiving your paycheck every month, allocate 50% to sustenance expenses, 30% to savings and investments, and the final 20% to living life queen-size.

2. Manage your own Money

It may seem slightly tedious, but learn to manage your own money. It may seem natural to pass on money decisions to one’s father or brother or husband, especially in Indian society. Do not do this. There are resources online where you can learn the basics of money management. Do not give up power to anyone else. You can definitely consult family members, but make your own decisions and maintain a separate bank account.

3. Invest Wisely

Every woman needs to put herself first. Yes, family and kids are a priority, but you also have to think about your financial security. So start investing early. Start with small recurring deposits, fixed deposits, and SIPs. Let the power of compounding work its magic. This money will prove valuable in future, whether it is to buy a home, travel, help in your child’s education or marriage, etc. Investing in gold is also a good move.

Jut saving money isn’t enough. You need to make smart investment choices as well. Your investment portfolio must not only beat inflation but also generate enough wealth to allow you to be financially free as early as possible.  In today’s age, money is power, independence, and freedom. You just need the right financial partner to help you achieve it.

4. Take charge of Fixed Expenses 

As the term suggests, your fixed expenses aren’t likely to change anytime soon. These include rent/EMI, insurance, etc. Prioritize expenses based on their importance and set a limit in stone. Fixed expenses will eat into the bulk of the funds you allocate for expenses. Prepaying a loan or moving to a relatively cheaper house can help you limit your fixed expenses. 

5. Cut down Expenses

Draw up a list of things/expenses you can do without. Eat out only once a week. Shop less – after all, one can only wear so many clothes and shoes. Meet friends at home instead of going to cafes and pubs. Set a monthly budget for toys instead of giving in to your kids’ every whim. You will realise it is possible to give up or ration whatever you can without it having a major impact on your lifestyle or comfort.

6. Put Technology to Use 

You name it and there’s probably an app for it – budgeting apps that keep you on point, apps that help you dial down on debt, apps that bring all your investments in place, even apps that invest the spare change left over from your shopping expeditions.

7. Make a plan to repay Debt

This is crucial if you want to be debt-free. Whether it is a home loan, car loan, or business loan, figure out how you can repay it at the earliest. You can set aside an amount every month in addition to the EMIs you pay. For example, if your house EMI is Rs 50,000, try to put aside another Rs 10,000 a month. In a year you would have saved Rs 1,20,000, plus some interest if you invested the same. You can use this amount to prepay the house loan, shaving almost three months off your repayment plan.

8. Plan your Tax Outgo 

Let’s be honest. No one likes paying taxes, but rather than leaving everything to the chartered accountant, it is wise to be more proactive and smart while paying your dues to the taxman. 
Ensure that you maximise benefits from all investment and tax-saving options available to you. You can save up to Rs 1.5 lakh with these tax-saving options. From Public Provident Fund to Equity Linked Savings Scheme, there’s a product for everyone.  
If you are already a home owner, you can claim additional deductions.  
If you are an entrepreneur, remember to save all your meal, travel, and accommodation bills, which you can claim as expenses and reduce your tax liability.

9. Buy Insurance

It is imperative that you buy health and life insurance to safeguard yourself and your family members. Pick a health insurance plan for yourself or a family floater plan for the entire family. Ensure it covers aspects such as critical illness, cashless hospitalisation, etc. Buy an insurance plan that also acts as a savings opportunity. You can pick an endowment plan that ensures life cover as well as savings, or a ULIP that gives an investment opportunity with life cover. The money you get on completion of the term will come in handy post-retirement.

10. Retire like a Queen! 

Traditionally, women have had shorter working tenures compared to men, with longer life expectancies. Add to that the pay gap bias and you have a triple whammy! 
First of all, ensure that you have a health insurance policy in place so you don’t end up financially crippled in case of a health emergency.  
Then do a back-calculation on how much money you would need after retirement, after accounting for inflation and taxes. Your investments and tax planning options should focus on achieving these figures. At work, don’t hesitate to fight against the pay gap. Make career decisions that put you first. 

Finally, age is just a number. You can even plan for a post-retirement career if you love working, and enjoy the increased financial independence it affords you in your golden years.  So take charge of your financial wellbeing and stay on top of every situation. After all, you are your own knight in shining armour!