5 basic tenets for women to ensure financial security

Manvi Agarwal
·7 min read

A financially secure future is a vital aspect of everyone’s life, be it a man or women. Even though men and women may have different investing mindsets towards attaining financial security, the investment principles for both are the same. The only difference is that most women tend to disregard this crucial aspect of their lives. Either due to sheer ignorance or lack of interest.

Ensuring financial security is imperative and not that difficult. All you have to do is study these simple tenets and implement them well.

Also read: 6 ways to discipline yourself into saving

  1. Educate yourself

The first step towards smart investment decisions is to study and research. So start by educating yourself about finance. Learn about the basics of budgeting, saving habits and investments. There are several trusted online tools at your disposal that can make learning easy and fun.

Successful investing and planning starts with self-evaluation. You need to analyse your financial needs first, in the present and the future. It will allow you to identify investment options best suited to your needs.

A common mistake people make is they don't focus on understanding their potential investment choices, acting on rumours or tips from their friends and colleagues instead. Sure, you might get lucky—but relying on luck, when it comes to financial security can be very risky. And so, a better alternative is to equip yourself with the knowledge to conduct your research. But if you find this overwhelming, you can always or seek the help of a trusted professional adviser.

Also read: 5 simple rules to help you invest better

  1. Establish a strong visual for the future, and work towards it

A visual for the future often involves defining your financial goals and more importantly, a specific timeline for you to achieve them.

Let’s assume you are around 25-year-old, looking to plan for any of the following:


The time period for achieving the goal

Risk absorbing ability

Investing in your business

5 years


Retirement @65

40 years


Child’s Education

18 years



10 years

Medium to Low

Identifying and planning for your financial goals will help you choose the right investments and build an effective investment strategy.

But how does this work? The key to investing successfully is to align your financial goals (future requirements) with your investments. Defining your financial goals help you recognise your:

time horizon: I want to buy a home in five years

risk appetite: the closer you are to your goal, the lower your risk appetite.

the amount you need to save now: so, if required, you can develop a prudent budget to accelerate your monthly savings.

All these are crucial elements for building an effective investment strategy. Simply put, the closer you are to a financial goal time-wise, the more protection you want for your money (savings). And the more time you have, the more risk you can afford to take.

Also read: Why cheap stocks are not always the best kind of investments

The investment world offers a diverse bouquet of investments varying in their risk and returns potential. Common examples include:

Stocks/Mutual Funds

Bonds and Fixed deposits

Cash (Savings account)









Ideal for a time horizon of:

Minimum 5-7 years

Less than 5 years

A Few months

So, if you are looking to buy a home ten years down the line, you must ideally invest 90% of your money in stocks/mutual funds and the balance in Fixed deposits.

As a woman, recognise that you may live longer and need additional planning: according to the World Health Organisation, women live longer than men, by an average of five years. As an investor, this makes them more susceptible to benefit from growth assets such as stocks.

Also read:

  1. Prepare for any medical emergencies with the help of adequate insurance

In addition to being one of the most important aspects of financial planning; insurance is also one of the most ignored. According to the National Family Health Survey conducted in 2018, only 20% of women age 15-49 and 23% of men aged 15-49 are covered by health insurance or a health scheme.

The huge monthly outgo of premium payments generally serves as a big demotivator to invest in insurance. Especially when you look back and realize you haven’t visited the doctor all year. Sure, there will be years when you rarely use your health insurance. But when the time comes; you will be thankful for those premium payments.

While you cannot predict or avoid an unforeseen event, you can prepare for them. And the best way is to buy insurance for you and your family.

As you start to plan for a healthy financial future, make life and health insurance a priority. Not only does adequate insurance protect you, but it also renders peace of mind; knowing you can battle any illness financially and that your loved ones will be taken care off in your absence.

When choosing a life insurance policy, stick to pure term plans and avoid mixing insurance with investments. The same applies to medical insurance. Ensure that you have an adequate insurance plan for the entire family and check to see if your policy issuer is acceptable at your nearest or preferred hospital.

Also read: Best investment options with high returns

  1. Shield your investments from unforeseen expenses

When the Covid-19 virus hit the world, we all realised the importance of an emergency fund. An accessible, liquid fund worth 9-12 months of living expenses was a blessing amidst such tumultuous times. Not knowing what is ahead, an emergency fund eliminated any worry about meeting household expenses. You didn’t feel the need to withdraw your ongoing investments or dig into your child’s education fund. This is exactly what an emergency fund accomplishes.

Think of it as a pot of gold dug deep inside the house of the 21st century.

No matter how financially tied down you are or what your goals might be, you need to save up for an adequate emergency fund first. So for any reason, the monthly income takes time to come in, you can manage your household and other commitments like EMIs and premium payments.

  1. Protect your investment portfolio from a global crisis

As uncommon as they might seem, the world has witnessed a major economic crisis every 8-10 years. So it only makes sense to insure your investment portfolio from such disasters.

A great way to do that is by investing in gold (experts suggest not more than 10% of your total investments). It is by far the most proven insurance for your investment portfolio, especially during a global economic crisis.

Be it the 2008 subprime crisis in the US or the Coronavirus pandemic, the only thing that was unfazed and an acceptable currency worldwide was the yellow metal.

Often referred to as a safe-haven in the investment world, the value of gold rises during economic stress, providing much-needed relief to your money. Even now, amidst such economic chaos when the stock market was in a free-fall, the price of gold skyrocketed.

Gold prices vs Nifty 50
Gold prices vs Nifty 50

Source: https://www.equityfriend.com/

But know that you can't expect your investment in gold to generate any returns. Think of it as a no-yield asset, an 'insurance' for your investment portfolio to smoothen your returns in a global crisis.

Single, married, working or not, most women at some point in time will be the sole decision-maker in their household due to divorce or death. So it's important you understand these fundamentals of securing yourself financially. Implemented well, these few basic steps can make your money work for you, as hard as you work for it.