Housewives can invest in mutual funds to secure their future
Housewives do not earn money for the housework that they do. For several decades now, a male breadwinner has given a certain amount of money to his wife to cover all household expenses. A typical housewife cuts down on all kinds of unnecessary expenses and saves money and bank deposits. In an emergency, she withdraws from the bank. Sometimes the husband and the children would be surprised to find that the mother has saved a considerable amount of money over a period of time.
With the pandemic taking away many of the main breadwinners, many families are facing immense financial distress. It is important for housewives to get involved and start looking for ways to invest and support themselves during difficult times.
Although many women have joined the workforce and things have changed now, there are still 160 million housewives in India, according to a BBC report, who generally save any amount, be it Rs . 100 or ₹1,000, a month.
According to the World Bank, women make up only 20% of the total labor force in India in 2019. These data show that a large number of women are still struggling financially and also depend on their husbands for all expenses. .
Financial advice for housewives
Housewives typically save between Rs. 100 to 1,000, per month, and there are many options that allow them to invest the same. Financial advisers say there is a system of recurring deposit and monthly income from the post office among other options, housewives should also consider mutual funds for long-term wealth accumulation.
Sujatha Govind, a housewife says: “After my marriage I was only able to work for a few years and had to quit after the first child. Since my husband works in a bank, I can save at least Rs. 5,000, per month, and I invest all my savings in a recurring deposit account. “
If Sujatha could save ₹5,000 a month, financial advisers say she should invest at least Rs. 1,000 in mutual funds. Starting a systematic investment plan (SIP) will be a good option for her, as it will also secure her future. It is not necessary to earn money to invest in mutual funds, whatever a housewife saves, she can invest the amount in mutual funds.
Although it is a good idea to open an RD account, financial advisers say that it is not wise to invest all the money in an RD account, instead, she could allocate 4,000 rupees to RD and the rest in a mutual fund.
“Besides savings accounts, recurring deposits, FDs, community and closed-loop token funds, gold token savings programs are also more common among women,” says C Sathish Kumar, CEO by Tradewise India.
Vidya Bala, co-founder of Primeinvestor.in, says that if housewives are risk averse, they can stick to regulated products like FD or RD banks, small postal savings, etc.
“For those who have long-term goals and can take risks, mutual funds with an appropriate asset allocation to equity and debt, based on the timeline of goals, will be a better option for them, ”she adds.
Mutual funds via SIPs
Housewife Sujatha Govind says that although she has heard of mutual funds, she is not confident enough to invest in the same, fearing losses.
Sathish Kumar explains that there is a need to educate housewives about mutual funds. “Right now there is no awareness among them and women have to overcome the fear of investing in mutual funds. Once they understand the various benefits of mutual funds, housewives will be very happy to invest or save through mutual funds due to the nature of the ease and liquidity. Plus, unlike an FD, a partial surrender is available in mutual funds. Thus, in an emergency, they can withdraw a partial amount at any time, ”he explains.
Housewives can invest even Rs. 500 or Rs. 1000 in MF schemes. If someone can profile them in terms of the time horizon and the risk appetite and rewards that go with it, MF will definitely attract more people. If one invests with proper advice, losing money in MF, but for market losses, is absolutely almost impossible, he adds.
Vidya Bala says mutual funds are great investment vehicles for all investors. SIPs – which are disciplined monthly savings – ensure that small amounts can be invested in mutual funds over a long period of time. But knowing which products to use for different time periods is important in MF.
Since word of mouth helps create new investors, if a group of housewives can discuss mutual funds and explain the same to other women, more people will show up to invest in. mutual funds. In addition, they must be very clear about their goals and time horizon. If a housewife starts investing in SIP with only ₹500 at 30, at 50, she will have a considerable sum for her future.
Key points to remember
1) Housewives should consider investing in mutual funds through systematic investment plans (SIPs).
2) We can invest in action programs, to achieve long-term goals.
3) If housewives are unaware of market conditions and unfamiliar with mutual fund investing, instead of investing on their own, they should seek help from a financial advisor. mutual fund or financial advisor.
Disclaimer: This article is part of the HT Friday Finance series published in conjunction with Aditya Birla Sun Life Mutual Fund.