Indian women have mastered the art of managing money given how many of them run budgets for large families, look over monetary give-and-take amongst relatives, supervise wedding expenses, and in the last two decades and more, work on maximising their income from jobs and entrepreneurial ventures too.
In case of an emergency, you can almost always rely on the woman of the house to have some money stashed away in savings, at the bank, in a gullak, or some secret corner of the house. While this money may come to aid during times of need, there isn’t much provision and education around women being able to build long-term wealth. So how can you understand the benefits of long-term wealth and the key steps that aid the process?
Satyen Kothari, the Founder & CEO of Cube Wealth shares insight and advice about the status of long-term wealth in the life of an Indian woman, the importance of it, and some smart money habits one must follow.
1. What does long-term wealth mean?
Long-term wealth creation means you take a patient and systematic approach to investments. You focus on investment opportunities that promise healthy returns over the next 5 – 10 years instead of chasing short-term gains.
2. What is the importance and benefits of building long-term wealth for Indian women?
Long-term wealth creation is the key to financial freedom and independence. This is something that many Indian women aspire to achieve and a combination of high-quality investment advice and simple automation can help them build the perfect portfolio of investments. This will help them achieve all financial goals.
3. What are the key steps of long-term wealth accumulation?
Patient, consistent and disciplined investing are the key steps for long-term wealth creation. This can be made easier by using a wealth creation platform. There are many such platforms and apps that offer a variety of services like connecting you with financial advisors and wealth coaches or even automating your investments.
4. How can you build wealth in your 20s & 30s as a working woman? What are some tips for homemakers to start their journey towards long-term wealth building?
Irrespective of your profession, if you’re someone aged between 20 and 30, this is when you can afford to be the most aggressive with your investments and undertake the most amount of risk. Limited financial responsibilities and the fact that your peak earning years are ahead of you means, this is an ideal time to start investing. The sooner you start investing, the more you can benefit from the magic of compounding.
- You can start by saving regularly and setting money aside for emergencies. This can be done by investing in a liquid fund so that you get decent returns but don’t have to lock your money up as you would in a fixed deposit. At Cube Wealth, this is what we call the Emergency Fund Bucket.
- The next step would be to ensure you have the right insurances. This is your Protection Fund Bucket where you will buy a simple term life insurance, health insurance for yourself or a family floater, depending on your situation.
- If you own a home or travel a lot, then you should get home insurance and travel insurance as well. This makes sure you are not financially dependent on anyone during times of crisis.
- The next 3 buckets are your short-term, medium-term & long-term fund buckets. Here you will invest in mutual funds, stocks, gold and alternative investments based on your goals. This is something covered in detail under Cube’s Perfect Portfolio philosophy.
5. How do shares, mutual funds and other investments like gold and precious jewellery help women accumulate long-term wealth?
If you’re investing for the long-term and consulting a wealth coach, you will be able to pick high-quality stocks, mutual funds, digital gold etc. These assets have varying levels of risk, liquidity and potential for growth. A good investment app will help you narrow down your choices by showing you the best options for you. It will also help you look at wealth creation in a holistic manner. This way you’re not thinking of just growing wealth but growing wealth for specific life goals.
All these assets have the potential to help you grow your wealth but, there is nothing more important than getting proven advisors to help you pick the right investments. After all, someone who does this day in and day out is going to do a better job at it than most of us.
6. What are some smart money habits to help you achieve long-term wealth?
There are many habits that can help you achieve long-term wealth but, the ones that have the most impact are paying yourself first, investing consistently and taking a long term approach over short-term gains. If you set up a quick SIP in a few expert-picked mutual funds you will be well on your way to creating long term wealth thanks to the magic of compounding. A simple SIP calculator can show you the impact of disciplined investing.
Many people have get-rich-quick dreams when they begin investing; this isn’t the right way to look at things. It is almost never about one short term investment that gives you 10X returns, instead, it’s about starting early and buying quality investments that align with what will be your perfect portfolio. It’s a slow process but, it’s the right way to approach long-term wealth creation.