How Woman Should Plan Their Investments

Are women really risk-takers? Especially where their hard-earned money is concerned? Not really, if research is to be believed. According to Gloria Steinem, renowned feminist, women were not gamblers.

The truth is women are conservative where money is concerned. The bigger truth is that they don't really have the money to spare for something which has no assured returns. But they are good at handling money too. They will shop, they will spend, yet, they will also save. What about investing? Well, the request is still being processed.

Investment strategies for women

Research has shown that women in general find it stressful and time-consuming to invest. They have an inherent fear about investing, and hence a knee-jerk reaction to this fear is to avoid investing completely.

They would rather save the old-fashioned way than invest. They would rather have gold than stocks or government bonds rather than stocks.

Yet, with the way the inflation is rising, the old-fashioned way of saving would give old-fashioned results. You will still be able to buy products but not your beloved brands.

So, even if it's the stars that you want, then you better sit up and re-examine your inherent investment make-up. After all, a penny saved is a penny gained while a penny invested is an income gained.

You say: "We are conservative."

Suggestion: Play it to your advantage.

The fact that women are conservative and cautious by nature is actually their strength. They don't get swayed by quick rich schemes and tend to evaluate an investment opportunity thoroughly before taking the plunge. So, the chances of your losing money in an investment are minuscule.

An interesting fact supports the claim: Catalyst, a research organisation, studied Fortune 500 companies and found that companies with more women at the top delivered a 34 per cent higher return than companies with fewer women!

You say: "We lose track of our income and expenditure."

Suggestion: Keep them separate.

Women have an intuitive approach towards seeking solutions – they spend! So whether sad, happy or plain bored, your hand instinctively reaches to your purse. Hence it is essential to keep separate the amount to be saved and spent.

You can have two different accounts. It helps. Otherwise, you tend to dip into the same pool and spend more. You also lose track of how much you spend and save on a daily, weekly or even monthly record.

You say: "We stick to routine better."

Suggestion: Have a fixed ratio of investing to spending.

It is generally seen that women stick to routine when it comes to investing. You usually save and/or invest a fixed sum month after month. You don't really evaluate your investments at regular intervals.

As compared to men, fewer women end up changing the amounts invested during the previous year(s) or plan to change their asset allocation in near future. Irrespective of the market scenario, women always end up following a fixed investment routine.

It has been observed that women start saving late in life. Usually, they decide to save/ invest when they think there is a responsibility upon them, e.g., children's education or helping parents, etc. That's when they usually develop and stick to an investment routine – say, investing in mutual funds every six months or buying Postal certificates every month or contributing to a chit fund regularly.

So, have a 50-50 ratio. Save half of your income; spend half of it. Over time, you will have a sizeable sum invested, which will bring you favourable returns.

You say: "We want Mr. Right."

Suggestion: Settle only for 'The One'.

Many women still prefer the help of advisers – be it a consultant, husband or a friend. They want their financial adviser to have all the qualities of a 'Mr. Right'. He should be smart, sensitive to their needs and irrespective of what the whole world says he should be able to take decisions on his own and prove them right. Most importantly, even though they may be independent women, he should be 'dependable' and make them feel secure.

You say: "A charming woman doesn't follow the crowd. She is herself."

Suggestion: Take decisions in tandem with your personality.

"A charming woman doesn't follow the crowd. She is herself", said Loretta Young. Uniformity has never worked for women. Some of them would prefer the old world charm of dependable, stable stocks with assured returns, in which case it's large cap companies/blue-chip stocks that they should think of. While, some of them, would settle for mid and small size stocks, hoping they strike gold with one of them.

Meanwhile, a blend of moderate risk and high promise would excite a few of them. Based on your capacity and the urge to take risks, allot some specific percentage of your income to blue-chips, fixed deposits or small and mid cap stocks. At the end of the day, you just have to be yourself and the decisions to make will end up being a lot clearer.