As soon as children are old enough to understand the concept of money, mothers can begin introducing basic financial concepts and the importance of saving, says Madhu Lunawat, Executive Director, Pantomath Capital Management.
In an interview with MintGenie, Lunawat said it is crucial for women, whether homemakers or working professionals, to prioritize buying insurance for themselves.
Edited Excerpts:
Q. What is the most important financial lesson that you would like to impart as a mother to your child?
The most important financial lesson I would like to impart to my child is the importance of budgeting and investing. Teaching them how to manage their money wisely, spend within their means, and invest for the future will instil a strong foundation for their financial well-being.
Q. At what life stage of the child do you think mothers must start discussing savings and investments with their wards?
It is never too early to start discussing savings and investments with children. As soon as they are old enough to understand the concept of money, mothers can begin introducing basic financial concepts and the importance of saving. My nine-year-old is already into investments and is very good at analyzing products. As they grow older, more detailed discussions about investments and long-term financial planning can be introduced.
Q. Be it homemakers or working women, why should women focus on buying insurance for themselves?
It is crucial for women, whether homemakers or working professionals, to prioritize buying insurance for themselves. Insurance provides financial protection against unforeseen circumstances such as illness, disability, loss of life, etc. By having adequate insurance coverage (pure insurance products and not endowment), women can safeguard their own financial well-being and that of their families, ensuring peace of mind and financial security.
Q. What financial gifts would you like to gift yourself as a mother this year?
I am more into investing in mid-size companies. However, this year, I would like to add National Pension Scheme (NPS), digital gold, and other long-term products to my investment portfolio. It's important to prioritize self-care and financial security as a mother.
Q. Do you advocate mothers working on a separate retirement corpus to secure their future?
Yes, I strongly advocate for mothers working on a separate retirement corpus to secure their future. It's important for mothers to prioritize their own retirement savings alongside any joint or family savings. Building a separate retirement corpus ensures financial independence and a secure future, allowing mothers to have a comfortable retirement and meet not only their own financial needs but also the needs of their near and dear ones without depending on others.
Q. More people are now writing wills to remove discrepancies regarding the nomination. Do you think today's mothers should also pen their wills?
Yes, I believe today's mothers should consider penning their wills. Writing a will helps ensure that their assets are distributed according to their wishes and provides clarity and guidance for their loved ones in case of unfortunate events. It allows mothers to protect their family's financial interests and make important decisions regarding guardianship of their children, assets, and other matters.
Q. Which investment instruments do you think would serve best for today's mothers?
The choice of investment instruments for today's mothers depends on various factors such as their risk tolerance, financial goals, and time horizon. However, some investment options that may serve them well include mutual funds, fixed deposits, Public Provident Fund (PPF), National Savings Certificates (NSCs), and systematic investment plans (SIPs) in equity or debt funds. It's advisable for mothers to consult with a financial advisor to determine the most suitable investment instruments based on their individual circumstances and objectives.
