Women

10 Things Women Can Do to Manage Personal Finances Better in 2021

Aage aage wo chale peeche saari duniya
din na dekhe raat na dekhe peeche padi hai duniya
aur nahi koi aur nahi wo to hai rupaiya
gol gol chaand sa rupaiya
kaisa hai ye khwab sa rupaiya

— Visheshwar Sharma, Kalyanji Anandji, Kishore Kumar and Surendra Mohan, in Hiraasat.

Okay, the headline was clickbait.

But now that I have your attention I have a few important things to share. I make a living by writing regularly on economics and finance. But this isn’t how it always was.

For my first couple of years in journalism, I largely wrote on personal finance topics. It took me a couple of years to figure out that between the product sellers and the personal finance writers, the subject was made needlessly complicated.

The trick wasn’t to try and understand every new product/idea that hit the market, which is what personal finance pages in newspapers and personal finance websites and magazines cater to, because they need to fill up space, so that they can gather advertisements against that space. Of course, personal finance writers need to keep writing about newer things and same things in newer ways, to keep their jobs.

When it comes to companies selling personal finance products, they are largely in the business of raising money and not necessarily managing it well

Hence, what is more important is to understand the broader principles of the subject and then stick to them over a period of time.

In the last fifteen years I have ended up advising more women on personal finance issues than men. In my limited experience, women seem to be more interested in understanding the nuances, the men typically play know it all when it comes to personal finance.

In this piece, I will elaborate on principles I think every woman should follow when it comes to managing her money and personal finances. (In fact, most of these principles can be followed by men as well, but then they know it already).

If you aren’t following these principles, 2021 is just about here and now is as good a time to start as any.

Here we go:

1) Save for the sake of saving. This is a very simple principle but many women I have come across, just don’t get it. They want to save for their next holiday, the next diamond ring, the next home, the next car, the children who aren’t there yet, the next whatever…

In fact, Morgan Housel makes this point beautifully in his recent book The Psychology of Money: “Only saving for a specific goal makes sense in a predictable world. But ours isn’t. Saving is a hedge against life’s inevitable ability to surprise the hell out of you at the worst possible moment.”

Like when the covid pandemic hit India in late March, people who had saved money for the sake of saving and had money in the bank account, were able to handle the situation in a much better way. If you lost your job and had money in the bank account you didn’t have to take on the first new job that came along. You could wait for something better.

As Housel puts it: “Savings without a spending goal gives you options and flexibility, the ability to wait and the opportunity to pounce. It gives you time to think. It lets you change course on your own terms.”

Further, if you save for the sake of saving and have money in the bank, you will be able to make the decisions, right or wrong, you want to make in life, and which might even mean not being pressurised by your family to get married to the next guy they discover on Shaadi.com.

If this isn’t important I don’t know what is. Hence, being financially independent is very very important and that can only happen if you save for the sake of saving.

In fact, as Housel puts it:

“We can leave aside rich, but independence has always been my personal financial goal. Chasing the highest returns or leveraging my assets to live the most luxurious life has little interest to me. Both look like games people do to impress their friends, and both have hidden risks. I mostly just want to wake up every day knowing my family and I can do whatever we want to do on our own terms. Every financial decision we make revolves around that goal.”

 

This should be the ultimate goal of saving and money in the bank account should not be a signalling effect for the society at large.

2) If you work for a company, be aware of how your salary is structured. Too many companies use the cost to company (CTC) approach to take their employees for a ride. If you don’t understand the items that make up your salary, ask around, Google, do whatever is needed to understand them. I come across way too many women who work very hard on their job, but have no idea of their salary structure (This is not to even remotely suggest that men have it all figured out). If you have ESOPs as a part of your CTC, know when they will vest and when you can sell them. The same when it comes to the soft loans that you can take from the company. It’s slightly difficult to understand this, but it’s not rocket science.

3)  I think this is the most important point that I will make in this piece. Way too many women I know, leave the managing of their finances to their fathers (a horrible horrible idea because they will make you buy LIC policies), spouses (might end up taking too much risk than you prefer) or boyfriends (you might just breakup, who knows).

I mean if you work so hard to earn the money that you do, why not spend some time to figure out how to manage it well. As I said earlier, money in the bank, helps us make the decisions that we want to. If you can spend a week planning a ten-day holiday that you take during the course of a year, I am sure you can spend a few days understanding how to manage the money you work so hard to earn through the year.

4) This is a tricky point and hasn’t gone down too well with most women I have shared it with. Don’t have all your money in joint bank accounts with your spouse (works for the husbands as well). I am not remotely trying to suggest that if things don’t work out between you guys, he will cheat you on the money front (he may, but then who am I to suggest that). But untangling these things can be quite a pain.

So, it makes sense to have one joint account for the shared expenses, but beyond that have your money in your bank account. (Believe me, if things don’t work out, you are going to thank me forever for this).

5) This is another tricky point. If your father/husband/boyfriend/brother manages your money, be aware of where that money is parked. Be aware of the loans your husband has taken on. Again, I am saying this from experience. Many women just tend to be totally unaware on this front and then one day when the father dies, the husband leaves or the boyfriend breaks up, the reality of the situation suddenly hits them. Just getting a bank account shut after someone’s death can be a huge pain, if you are unaware of the details.

6) Many women don’t like the idea of managing their money because they think there is a lot of maths involved in it (Again, this is not to suggest that men understand the maths). It’s just basic fifth standard maths, which is not difficult to understand at all.

7) Make sure that you are making full use of the tax deductions available to you as a married couple. (Again, the husband may have no idea, doesn’t mean you also don’t).

8) Diamond jewellery looks great on you and please wear it by all means but don’t go about buying diamonds all the time. It’s a bad idea. Selling diamonds can be a difficult business in case of an emergency. (Don’t believe me, just Google).

9) If you are starting out and don’t know how to go about managing your money, just do a recurring deposit with a bank to start with. It won’t give you a great return but some money will start accumulating and some money is better than no money. Also, don’t buy an insurance policy unless your family is dependent on you or you have outstanding liabilities.

10) And finally, since we are about 2021, do remember that sometimes return of capital is more important than return on capital. 2021 will be that kind of year. Manage your money accordingly.

To conclude, these points go beyond doing the basic things, like investing regularly over a long period of time to ensure that you end up making decent returns and not necessarily the highest returns, not having all your investments in one asset class (diversification), buying a house to live in and thinking very carefully about buying another house, not over-leveraging yourself and not making any investment decisions which will keep you awake at night. Nothing is worth ruining a good night’s sleep.

The Mother Economy

Mother_India_poster

Gross domestic product or GDP, is one of the most used or perhaps abused terms in economics. The trouble is that too many people use it without realising that it is ultimately a theoretical construct and not a real number.

In the simplest terms GDP is defined as the value of goods and services produced in a country during the course of a year. The trouble is in defining what has a value and what doesn’t. As the old GDP joke goes, when a man or a woman marries his or her housekeeper, the GDP of the country goes down. This happens simply because the housekeeper was paid for doing the house work. The spouse clearly won’t be.

On a serious note, this joke shows a big loophole in the way the GDP is calculated. The calculation takes only paid work into account. The trouble is that unpaid work forms a very important as well as large part of the economy, though this is something that most people do not realise.

As Kate Raworth writes in Doughnut Economics—Seven Ways to Think Like a 21st-Century Economist: “If you have never really thought of it before, then it’s time you met your inner housewife (because we all have one). She lives in the daily dealings of making breakfast, washing the dishes, tidying the house, shopping for groceries, teaching the children to walk and to share, washing clothes, caring for elderly parents, emptying the rubbish bins, collecting kids from school, helping the neighbours, making the dinner, sweeping the floor, and lending an ear.”

Most of us do these things and don’t get paid for it. Nevertheless, they are a very important part of the lives that we live.

Raworth is British and hence, invocates the term inner housewife. In India, there are real housewives (not that they are not there in Britain) who just take care of the home. As per the National Sample Survey (NSS), for women in the age of 25-54, the labour force participation rate varies between 26 to 28 per cent in urban areas and 44 per cent in rural areas. Hence, most Indian women don’t work, in the conventional sense of the term. But they run their homes. Even young girls who are not married are expected to contribute towards house work.

All this never gets counted towards the GDP. As Raworth writes: “In sub-Saharan Africa and South Asia… when the state fails to deliver, and the market is out of reach, householders have to make provisions for many more of their needs directly. Millions of women and girls spend hours walking miles each day, carrying their body weight in water, food or firewood on their heads, often with a baby strapped to their back – and all for no pay.” And given that there is no pay, the work does not reflect in the GDP.

In fact, economists have even put numbers to this unpaid work. “A 2014 survey of 15,000 mothers in the USA calculated that, if women were paid the going hourly rate for each of their roles – switching between housekeeper and daycare teacher to van driver and cleaner – then stay-at-home mums would earn around $120,000 each year. Even mothers who do head out to work each day would earn an extra $70,000 on top of their actual wages.”

This unpaid work which is a very important part of a running a household smoothly as well as bringing up a child, is not reflected in the GDP. And that is a real problem. This patriarchal attitude of economics as it is practiced, needs to be corrected in the years to come.

The column originally appeared in the Bangalore Mirror on June 9, 2017.

Why women will continue to be raped in India

rapeVivek Kaul
Late last night while flipping television channels I saw TV Mohandas Pai, a former CFO and HR Head of Infosys, advocating ‘chemical castration’ for rapists. A leading television anchor also ran his show yesterday around the theme and instigated his celebrity panellists in trying to get them to advocate chemical castration for rapists in India. That is the problem with arguments that emerge due to the heat of the moment. My heart is also thinking along similar lines. It even goes to the extent of telling me that the rapists should be stoned to death. But my head tells me even that won’t make a difference.
Any solution is as good as the system that executes it. In a country like India if anything like chemical castration for committing rapes becomes the order of the day and the police are pushed to solve rape cases faster, what are they likely to do? More often than not they will get hold of some random guy (the homeless, the slum dweller or probably just about the first person they can get their eyes on) beat the shit out of him and get him to confess to it. How do we ensure something like that does not happen? There is absolutely no way to do that.
The other point here is that the police and the judiciary the way they have evolved in India cater more to the rich and powerful rather than to those who ‘need’ the system to work for them. How do we ensure that solutions like ‘chemical castration’ will not be abused by the rich and the powerful?
Someone very close to me for the last two years has been caught up fighting a false case registered against him in New Delhi. It takes is a bribe of Rs 15,000-20,000 to the local thanedar to get a false first information report (FIR) registered. And it takes Rs 500-1000 to the babu at the court to ensure that the case does not come up for hearing, every time it is scheduled. And this in a place like Delhi, which is the capital of the country. Imagine what must be happening in small towns and villages across India? The police in this country have sold out lock, stock and barrel and they shouldn’t be given any further ways of creating more problems for the citizens of this country.
What is interesting is the speed with which Delhi Police has acted in this case and managed to round up most of the rapists. The Delhi High Court has taken suo motu cognizance of the gang-rape and asked the Delhi Police to explain how the offence remained undetected.
Yes the citizens of this country are up in arms against what has happened but that I don’t believe is the real reason why the police and the judiciary have acted with such speed. The only reason for showing the speed that the system has is that the rapists come from the lower strata of the society. They are the ordinary citizens of this country.
As The Times of India reports “The accused have been identified as Ram Singh (33), resident of Ravidas Camp at Sector 3, R K Puram (driver of the bus, DL1PB-0149), his brother Mukesh, 24, (who was driving during the gang rape), Vinay Sharma, 20, (an assistant gym instructor in the area), Pawan Gupta, 18, (fruit seller), Akshay Thakur, 26, (bus cleaner) and another cleaner, Raju, 25.”
If the accused had been the sons of the rich and powerful the entire administration would have by now been working towards getting their names cleared.
The molestation charges against SPS Rathore, an inspector general of police were never proved. He got away with more than a little help from his friends in the government. Manu Sharma, son of Congress politician Venod Sharma, was first acquitted for the murder of model Jessica Lal. With the hue and cry that followed the judgement was overturned and Sharma was sentenced to life imprisonment.
In 2009, Sharma was allowed a parole of 30 days to attend to his sick mother and other matters. His mother was later found attending public functions and Sharma was found partying at a nightclub in Delhi.
Matinee idol Salman Khan had rammed his Toyota Land Cruiser into a bakery in Bandra on September 28,2002, killing one person and injuring four others. The case has dragged on for ten years now. Recently, cop turned lawyer-activist YP Singh revealed that the “Police had deliberately not taken the job of issuing summons seriously. Also, Salman was absent 82 times when summoned by the court.” This is what the rich and powerful in this country can do. The police is at their beck and call. Loads of rape cases go nowhere because the rich and the powerful who are the accused simply bribe their way through the system. When the accused go unpunished or justice takes a long time to be delivered, it makes rape a way of life for Indian men.
That brings me to my final point, the male:female sex ratio in India. As Vivek Dehejia and Rupa Subramanya write in Indianomix – Making Sense of Modern India “In 2011, the Census estimates that there were 914 girls for every 1,000 boys for the ages 0-6. This is even worse than in 2001, when there were 927 girls for every 1,000 boys. More pointedly, this ratio is the worst ever since the country’s independence in 1947…In nature, with no sex selection the observed sex ratio is approximately 1,020 males for every 1,000 females.”
What this tells us is that as a country we have a ‘son’ preference. And that leads us to sex-selective abortion and even female infanticide. In simple English we kill our girls before and just after they are born. Delhi and the neigbouring state Haryana have among the lowest sex ratios in the country. And it just doesn’t end there. Debraj Ray and Siwan Anderson have carried out research to suggest that most women who go missing in India do so as adults than at birth or as children. That explains India’s highly skewed sex ratio in favour of men.
Dehejia and Subramanya talk about the research of Ray and Anderson in their book. As they write “They show that about 12 per cent of women in India are missing at birth: they are probably missing due to sex selective abortion or infanticide. Another 25 per cent perish in childbirth. But that’s only a little more than a third of the total. Another 18 per cent go missing during their reproductive period, which picks up among other things deaths during childbirth. But a massive 45 per cent of the total number of missing women go missing in adulthood, something which by definition cannot have anything to do with sex selection.”
Anderson and Ray come up with some more information. “They find that it’s only in Punjab where the majority of missing women are at birth: in fact it’s as high as 60 per cent of the excess female mortality in the state…Two other states show up as having a majority of of their women missing at birth or in childhood (before the age of 15) and it shouldn’t surprise you to learn that they’re Haryana and Rajasthan.”
Hence, we kill our women before birth, after birth and keep killing them as they grow up. In a society like this it is not surprising that men grow up with terribly demented minds and commit heinous rapes like the one in Delhi.
People are appalled. And they want instant justice. Chemical castration. Public hanging. Stoned to death. Anything will do. But what has happened is sheer reflection of the way India has evolved. Women being raped day in and day out is a story of Indian evolution.
And evolution cannot be undone.
So we might take to the streets to protest.
Have candle night vigils.
Protest on Twitter and Facebook.
Call for chemical castration.
Face water cannons from the police.
Sing ballads against the government.
Breakdown and cry while speaking in the Rajya Sabha.
But things won’t change.
As Arvind Kejriwal keeps reminding us “poore system ko badalna padega”. And that of course is easier said than done.
And in a day or two when our conscience is more at peace with itself, we will go back to living our lives like we always have. Because we are like this only.
Meanwhile women will continue to be raped.
The article originally appeared on www.firstpost.com on December 20, 2012.
(Vivek Kaul is a writer. He can be reached at [email protected])