Although women are generally financially disciplined, their reluctance to take the lead in managing finances often stands in the way of their financial independence.

Even educated and working women are often dependent on others for money. “Women need to understand that personal finance is not rocket science. They can do it on their own,” says Preeti Sende, SEBI-registered investment advisor and founder of Apnadhan Financial Services.

Let's look at some ways to help you take charge of your money and achieve financial freedom;

Create a contingency fund to cover career breaks

It's the first step in any person's financial planning process, but the possibility that women are taking more career breaks cannot be ruled out. The rule of thumb is that you should set aside at least 6-12 months worth of household expenses in a fixed deposit or liquid fund. However, women also commonly have to take career breaks due to reasons such as pregnancy, child care, and spouse's work. So, they should have a buffer fund of two or three years of their expenses.

Take adequate life and health insurance covers

In addition to an emergency fund, insurance is another tool to protect yourself from a financial crisis. You need an adequate health insurance policy for your medical treatment. Even if you are covered under corporate or family floater policies, look into having an independent health plan. “Look to start with a personal cover of at least Rs 25 lakh – have a basic cover of Rs 7.5 lakh-10 lakh and a super top-up plan to take care of the balance. This combination will ensure a low premium outgo. If you have children, buy a term insurance cover worth at least 10-15 times your annual income to protect their financial future in your absence.

Contribute to household expenses, but also build your own assets

Women tend to focus on household expenses, neglecting the need to invest for themselves. “Usually, women take care of regular household expenses, while husband's salary is diverted to investments for the family. However, while women can continue to contribute to their household budget, they should get used to using a portion of their income to build their own assets. Those with no financial knowledge can start with simple instruments like bank or post office recurring deposits and fixed deposits. Or start with an index equity mutual fund and a hybrid mutual fund.

Even if you don't know much about finance, try to learn the basics of money management. Take time to learn about your money—explore savings accounts, investments, and budgeting tools. The more you know, the more empowered you feel. Understanding your finances can give you leverage and control. It may take some time, but follow through.

Be aware of family finances and assets

During COVID-19, in particular, many families lost their breadwinners and did not have access to deposits or life insurance policy details. It is important to know about financial investments for your family and other assets to avoid such crises.

Women need to seek information and be aware of the investments made to secure their family's future. Homemakers, in particular, should be aware of nominations in investments held by their husbands. Women who have created their own assets should also ensure that their nominations are updated. Apart from nominations, it is also advisable to prepare a will to ensure that your investment is used for the welfare of the beneficiaries of your choice.

Entrepreneurial aspirations? Plan ahead

Inspired by the success of several startups in India, many now want to walk that path. Many women are attracted to the freedom that comes with turning their passions into business ideas and being your own boss. Then, some want to upskill themselves after a career break or when trying to change their job profile. If you too have such ambitions, set goals, prepare a financial plan and work towards creating a corpus.

Don't neglect your retirement goal

Finally, in the pursuit of family well-being and happiness, don't lose sight of your own retirement goals. The social structure of the country has changed over the years. Men aren't the only ones who need to plan for retirement — it's gender-neutral. Women are more focused on investing in their children's education. Regardless of your personal circumstances – whether you are married or single, you should start investing for your personal goals from scratch.

Invest in index, large-cap or diversified equity funds in a structured manner through Systematic Investment Plans (SIPs) and be prepared to stay ahead whatever the mid-term market volatility. Although the estimate of the ideal retirement corpus depends on many factors, the rule of thumb is to have at least 30 times your annual expenditure at retirement.