The evolving scenario of women’s financial freedom

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Women have long faced deep, systemic inequalities when it comes to their personal finances. From pay discrimination to depriving women of opportunities for financial education, lasting disparities have resulted in a deep gender bias that has limited economic security for women across the globe.

Today, we are beginning to see signs of change as women strive to achieve financial independence. Women around the world are fast making strides toward empowerment with their increasing share in the labour force and contributions to the GDP. According to a 2020 report by Boston Consulting Group, women are becoming a strong economic force with control over a third of the world’s wealth. The study also found that Asia is expected to lead the pack in wealth creation for women. These are significant statistics and yet, women in India are still under-represented in wealth and personal finance management.

Taking charge

Indian women are gradually taking charge of their personal financial futures through strategic decision-making, entrepreneurship and family asset management. A survey conducted by the Confederation of Indian Industry (CII) found almost 57% of women entrepreneurs make their finance decisions independently. Additionally, a recent investment report by ET Money noted that in the past four years, women investors have earned around 10% more returns than their male counterparts every year. Even in 2020, a year full of challenges, women’s investments offered better returns.

Women are clearly reclaiming control over their finances with the intention of building independent wealth that would withstand future uncertainties. It would be wise to start paying attention to how women are investing and what they are doing differently. Women tend to spend more time researching and understanding their investment choices, leading to better awareness of the kind of risk they can afford to take. The investing style of most women aligns with the objectives of keeping money safe with long-term investments.

Digital gold

Women also comprise more long-term investors than men. This makes assets like gold, a staple in Indian households, an attractive investment for women as most want to build and preserve wealth. The newer generation of women is taking the security aspect one step further by opting to digitally invest in physical fractional gold to eliminate the need to think about insurance, storage and gold purity. Digital gold is also considered a good investment for women as it can be bought in fractional amounts, offering all ranges of income the opportunity to invest in gold and reap the benefits of high returns on its long-term investment. This, however, does not mean that women have low risk tolerance. There has also been a rise in women investing in cryptocurrencies in India and globally.

Difficult journey

Given the complexities around gender roles and societal expectations, it can be difficult for some women to begin their journey toward financial freedom. The financial industry should not forget to keep women and their differing goals in mind when creating investment products. As the wealth management needs and goals of women often differ from those of men, it is important to customise investment services. Discussions around money should include relevant advice and education that meet the unique and changing investment objectives of women.

With the widening reach of the internet and growing access to income through remote and flexible work, digital financial services and platforms have the potential to bridge the financial gap between men and women, empowering women to take their own financial decisions in a few easy steps. For instance, since gold is widely known to be a safe asset in India, women can invest in it digitally via a wealth-tech platform from the comfort of their homes.

More opportunities

Just as we celebrated the Indian Independence Day, we must also celebrate and support the financial freedom and economic empowerment of India’s woman. More must be done to provide women the opportunity to take ownership of their own personal money and build wealth for their future goals. Women’s financial empowerment will also ignite equitable growth in India and foster economic development across the globe.

(The author is founder & CEO of Gilded, a new-age wealth-tech app; views expressed are personal)