Sunday, March 05, 2023

5 Key Learnings from the IWD Personal Finance Session at Delhi, India


Women are the torchbearers of any society. If you educate a man, you educate one person. But if you educate a woman, you educate one family - BIG difference!

It was a room full of energy. It was the occasion of International Womens Day Celebration. Most of the 200 participants were young women who have been skilled at YWCA (Young Womens Christian Association) at Delhi. 

They were mostly from the lower middle-class families. None of them were from any professions stream like engineering, medical, accountancy or similar. None of them were aspiring of being an IAS or an IPS or were hoping to land a high paying job in US. They were pursuing basic graduation studies and were hoping to get some kind of a job somewhere soon.

Women are the torchbearers of the society. I have always believed that if you educate a man, you educate one person. But if you educate a woman, you educate one family - BIG difference!

They were about to earn the world of money. And what better time to give them a strong foundation on money, and how it works. Of course, we talked about saving and investing money. 

Such seminars never payback monetarily, but it is tough to explain how much they payback to our soul. I was excited before the session, and I am so deeply and immensely satisfied that I did take this opportunity.

Here are 5 key takeaways for everyone from the session. Though these learnings may sound simple, it is important that we keep re-emphasizing these learnings. Because simple things are easily forgotten. And they need consistent drilling.


Learning # 1: Investing money is not a choice.

A lot of us do not talk about money, and specifically about investing with our children, and more so the girls. Indian society has an attached a connotation of negativity with money. But if investing is not a choice in life, then why the hell we want our children and women to lag behind in life.

Investing is a necessity that is driven by inflation at one end, and financial freedom at the other end. 

If we do not invest, and do not beat inflation after paying taxes, then whatever we are saving is getting depreciated every year. Our savings are becoming futile with each passing day. All our hard work, sacrifice and discipline to save money is a waste of effort. 

On the other hand, if we cannot invest, there is no way we are going to achieve financial freedom - a milestone that is more than worthy to make our life more meaningful and purposeful.


Learning # 2: Save before you can invest.

If we do not know how to save money - regularly - and in sufficient amounts, then the only way you can invest money is by borrowing it. And I can tell you that borrowing and then investing the borrowed money is a sure shot way - to financial disaster in life. 

And I have seen enough people in life which has time and again proven that a financial disaster is one of the biggest stresses that you can ever have in your life.


Learning # 3: To save, expenses need more focus than income.

If you do not want your life to end in a financial disaster, and you want to save, then there are only two ways to go about it - increase your income, reduce your expenses, or a combination of the two.

Unfortunately, most of our life, we focus too much on the former. All our energies are so focused on increasing or sustaining our income that most of us do not even know how much we actually spend every month, under which heads, what's the family inflation, and so on. 

I have interacted with some of the biggest financial wizards in India and when I ask them to jot down their expenses for 2 months, they are themselves shocked about the total expenses they are incurring. They say that they never had any idea how much they were spending each month. 

Now, if I ask you about your income every month, you will probably know the income to quite a level of accuracy - may be up to the units or tens place, or at least the hundreds place. But if I ask you about your monthly expenses, you will only have a vague idea - and trust me, your vague idea is far from reality, and it is going to hit you one day - the day when your income stops, and you only have expenses to deal with. And that day will come in your life, as it will in everyone else's.


Learning # 4: Budgeting and tracking are key to manage expenses effectively.

And if there is an effective way to manage and control expenses, it is the traditional budgeting and tracking way. You need to know how much your spending budget in the month is, and then you should be tracking how much you are actually spending against the budget. 

Its primitive, and old school, but very effective. Using techniques like 'Pay Yourself First' gives you the discipline to save before the money can be spent. Remember that if you do not track and control, then expenses have the uncanny capability to catch up your income.


Learning # 5: Women are much better investors.

It has been proven in various studies that women are much wiser investors than men. Studies show that women spend more time researching their investment choices. And while they do take on less risk than men when it comes to investing, that doesn’t mean they’re risk averse. Rather, they’re simply more likely to take on appropriate levels of risk with their investments than men. Both of these findings make for better investing outcomes.

In India, the social stigma attached with women and money, and their own self-confidence are the only things stopping them. And if we can instill enough confidence them and encourage them to take charge of their own financial life, we will do a world of good to them.



I learnt and relearnt so much from the session. 

I am sure you learnt from this post. 

And if you have women in your life you want to do well, please do your bit and share this post to them and their families. Who knows, this small act can go a long way in making a better society for us and our coming generations.

Leaving you with some snaps from the session....

 

        




Regards

Manoj Arora
Official Website

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