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NSE Invest O Cast episode 10: Women’s Day special – How to get financially independent

My name is Hrishi K and I’m your host on this podcast, it’s all about getting your money to make better investments for you and help you get the financial independence that you want.

A very very happy Women’s Day to all you lovely ladies and since it is your day today, we are going to be talking about financial independence especially for you in our podcast.

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We spoke to women around us to tell us what financial independence means to them and we got a variety of responses. For some, financial independence meant not asking for money from their parents or partners, for some it meant not having to do a day job, for some it meant being able to shop at their own will and for others it meant having a comfortable life after an early retirement.

We at NSE Invest -o-cast believe that true financial independence doesn’t just come from having a job or disposable income. Planning your money well also plays a very important part when you’re aiming to achieve financial independence.

You see it may sometimes seem like a daunting task. But frankly, it’s definitely within your reach. All you need to do is develop a few good habits and you will be well on your way to achieving financial freedom.

What are these habits you might ask? Taking the time to track your spending habits, budgeting on a monthly basis, cleaning your debts on time, not maxing out your credit cards, etc. etc…

And since we are celebrating women all this month, in today’s episode of Invest – O- Cast we are going to be talking about planning for financial independence for women; from different backgrounds and walks of life.

Hrishi K: National Stock Exchange (NSE) with the help of Invest – O- Cast (An exclusive investor podcast) Powered by MoneyControl is committed to break the limitations of geographical boundaries and reach investors across the country. In today’s episode we talk about, Preparing for financial independence.

And to help us with this, today on women’s day, I have with me Ms. Radhika Gupta, Chief Executive Officer, Edelweiss Mutual funds. Radhika, is an asset management professional with global and India experience across both asset classes, investor segments, and investment management and distribution. She started her career at McKinsey & Company, and then was a hedge fund manager with AQR Capital. She then moved to India to start Forefront Capital Management – an alternative asset management firm in India, which was acquired by Edelweiss in 2014. From 2017, Radhika has been the CEO of Edelweiss Asset Management.

Hrishi K: Hey, welcome to the show. I am very happy to host you on the show today and everyone would like to know more about you Radhika and also your efforts behind financial education and awareness in this country.

Ms. Radhika Gupta: Thank you Hrishi and wishing everyone a fantastic Women’s day I am very happy to be here. About myself I grew up all over the world actually in four continents, went to college in the US and then I have started my career in Wall Street as a Financial Services Professional, managing money is what I know it’s what I have done for the last 12 years. I move to India to start up my own business in 2009, ran that business managing money and then sold it to Edelweiss and now I run the mutual fund business for Edelweiss and I love the idea of talking to all of you and talking to women about how we can plan, how we can save, how we can become a lot more financially savvy and lot more financially independent.

Hrishi K: Well, friends on Wall Street tell me that it’s is nothing like the Hollywood movies show, it is a lot more hard work and then looking cool in suites would you agree?

Ms. Radhika Gupta:  It is a lot less glamorous for sure, it is definitely not glamorous it is very hard work. They never show you the 18 and 20 hours a day we work in the office on those screens, they just never show you, they show you the rich side of life.

Hrishi K: Radhika with your career spanning across four continents, like you just mentioned all these wonderful places did you find any difference in the way Indian women and non-Indian women plan their finances, I know it is more like a cultural question but it is important.

Ms. Radhika Gupta: It is important but there are couples of parts to it. one is that you know in India we tend to leave the decision making a lot to men even though we are more than competent to do it and I think that is cultural, why should I take the effort to plan my money you know someone will do it for me and I think globally women take a lot of charge and I think we as Indian women to take a lot more charge in doing that. Secondly we kind of hesitate to wet our feet with this whole concept of money, it is like it is too technical, it is too complicated, why should I get into it, I don’t understand and talk stocks all day so why should I do that and the truth is managing money doesn’t mean you have to talk stock or stalk stock all day as a women, you just need to make some smart decisions, get some basic knowledge and thanks to platforms like NSE and MoneyControl there is so much basic knowledge out there  in any case for you, so that is the second difference we kind of worry of getting our feet wet with it. And third is we are naturally attired with more conservative than the rest of the world and it is not just women I mean Indians are lot more conservative than the rest of the world.

Hrishi K: Well, thanks for that. You are listening to NSE Presents : Invest – O- Cast (An exclusive investor podcast) Powered by MoneyControl that  is all about helping people learn about their finances on the go…And today on women’s day we would like to understand a little more from Radhika about financial independence for women? And now the inevitable question is it different from men?

Ms. Radhika Gupta: I think it is because I think the man you know finance independence is given, culturally you know going back to what you said about culture as women we have always kind of been taught that first there was a father to take care of us and then there is husband to take care of us and at some point there will be a son and I know that the old school thinking that’s changed but deep in you that exist and it influences your decisions. So financial independence I think is something women consciously have to work towards. There is 2 parts one is earning your own money and second is managing your own money and I truly believe that by the way if you are a woman who is smart enough to earn your own money then also smart enough to know how to invest it.

Hrishi K: So let’s move to what are the most important things that women must do while preparing for that financial independence?

Ms. Radhika Gupta:  So I think the first is to start saving early and start their whole financial journey early. The easiest thing to do actually a man or a woman who delay this whole thing, I don’t need to invest in my 20’s, you know the amount of income I am earning is not really substantial it can wait till my 30s, it can’t wait and let me tell you why it can’t wait. I think in any process that you go through especially with money you will make mistakes that is inevitable and you should feel ok about it. When you make those mistakes in your 20’s by the time you come to your 30’s and you actually have real income you will be a much smarter investor. So as I said you have made your mistakes on the training ground and the practice, so it is very very important to start saving, thinking about money early. I think the second thing is to get a lot more financially literate, women have always talked about the fact that we need education because education gives you freedom and I think financial literacy and financial education gives you financial freedom, so while our schools don’t do that much of a job of teaching about personal finance there are lots of resources I said out there, so get savvy about it just like you are savvy about so many other things. You are savvy about social media, you are savvy about technology, and you are savvy about travel, get savvy about finances. So 2 things to get right start early and get savvy about it.

Hrishi K: Do you think financial independence would mean different things for a working women and a homemaker? If yes, then how?

Ms. Radhika Gupta:  A little bit so I think a working women it’s  little more complicated. I think with the working women it really starts from when you get your first salary and how to invest and save that salary sensibly and then you know as your income grows, how to have sensible financial goals, use that income, you know that you work very hard for your salary as a working women, your money should really work much harder than you, so that’s what your struggle is there. I think as a home maker just because you don’t have an income doesn’t mean you don’t need to know about managing money. Even a home maker does a very good job of running her house; Indian women do this really well. Running a house within a tight budget, in the old days we had this concept of ‘stree dhan’ or ‘naari dhan’ even then as a home maker you can take charge of your family’s finances, you can plan I mean money management is a process both husband and wife should participate in and the home maker should participate in, what are the financial goals you have as a family. Is it your child’s education, is it a family vacation or is it 10 years down the line a marriage, so even as a home maker you can be very very actively involved in the family’s finances and in planning the family’s goals.

Hrishi K: So what are the different ways by which women can work on being financially independent sooner, let’s try and put a road map for that Radhika.

Ms. Radhika Gupta:  So I think the first thing you do when you start earning your salary is think about the income and the expenses that you have and start putting a little bit of money away. You know even if you are earning 10 thousand rupees a month and you decide I am going to put 500 rupees a month away – remember no amount is too small just get started. The second thing to do is once you’ve started earning money has goals, there can be 5 years goal but we can also have 6 months goals. You can have goals of 6 month that you know I want to use this money and I want to save 50 thousand for myself and achieving small goals will make you feel very very good just as in life. Achieving small financial goals will give you a lot of confidence. The second thing women can do as I said is find out about the different financial instruments that there are out there whether it is bonds, whether it is equities, whether it is mutual funds and see how these financial instruments can be used to meet those financial goals. So start figuring out how to invest on a monthly basis, start figuring out what your financial goals are and then start figuring out the different tools there are to meet those financial goals.

Hrishi K: Just a few words of advice for women planners to help them balance ‘asset accumulation’ and ‘expense reduction’ in their journey towards financial independence Radhika.

Ms. Radhika Gupta:  So I think expenses are an inevitable part of our life you know income may or may not grow but expenses definitely grow. The best thing to do is and everybody knows they have expenses and you know we all want to live nice lives we all have expenditure, figure out a monthly income that you have, if you are a salaried women figure out a monthly income that you have and put a cap on your expenses you know whether it 40% of your income 50% but have the discipline to put a cap and say the balance I am just going to put away to save and you know if you have a goal to save 20 thousand rupees a month make sure that come what may you don’t deviate from that goal. That will automatically put a cap on your expenses and a year later by the way you will be surprised by the amount of assets accumulated just by doing this monthly. So money has an objective and you save of course to earn, to fulfill some kind of dreams, to fulfill some kind of aspirations but don’t let expenses creep into the process of asset accumulation and I think the best way is to put caps on it.

Hrishi K: Well Radhika insights on today’s podcast I am sure it will help a lot of women get a better perspective on their money.

And now, I am going to take you through some key points listed by her in our “Wisdom in the bank” segment. Hope you all find them useful and will definitely implement them while planning your financial independence.

 

    • Indian women leave a lot more to men and are reluctant to find out more out of fear of the unknown but one generation of women becoming financially independent will change future generations.

 

    • Knowing how to earn money, if you are smart enough to earn money you should be wise enough to invest, so start early.

 

    • Working women concentrate mostly on their monthly income.

 

    • Home makers think that they don’t have to learn how to invest because they don’t earn both could be wrong even then start saving early.

 

    • Expenses are reality that you have to have discipline around goals.

 

Radhika it was an absolute pleasure having you on the show.And very very happy women’s day once again. I am sure a lot of women are going to actually benefit from your advice on today’s podcast.

Ms. Radhika Gupta:  Thank you so much.

Hrishi K: And there is something that I want to say here on behalf of all the men to all the women listeners out there – You ladies are fabulous in everything you do. You manage home, work, family with equal amount of grace and panache that’s no mean feat. Kudos to all of you! We are extremely proud to have you in our lives. You continue to inspire us each and every day!

And just like you manage everything else so well, you are the only one who can best sort your finances and investments. Just don’t let the fear of losing money, fear of failure, or fear of the unknown stop you from investing in your future. Start small and scale up! That seems to be a mantra that no one goes wrong with. So, happy investing and a very happy women’s day.

And that is a wrap on our show NSE presents Invest-o-cast! I’m Hrishi K for the NSE Presents: Invest – O- Cast (An exclusive investor podcast) Powered by MoneyControl. To know more about our podcast, log on to moneycontrol.com and visit the podcast section. In case you would like us to address any of your investment queries on our show do write into us at: [email protected] that’s [email protected] You can also reach out to us on Twitter @moneycontrolcom or Facebook @moneycontrol.com ; do remember to use #nseinvestocast