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One Size Does Not Fit All: Shruti Agrawal, the pathbreaking Co-Founder's story

You’ve been lied to. Managing money well is not a skill with a gender bias. Men only do it better because they do it more. We spoke with Shruti Agrawal, SEBI registered financial adviser and co-founder of CAGRfunds, to bust these myths and replace them with valuable facts.

Deep conditioning throughout our lives is what leads to women becoming by standers with their own finances. Basis Shruti’s experience with clients, home makers almost never hold the position of managing their own portfolio. And even among working women, the percentage is much lower than ideal.

Two common symptoms of this conditioning are:

  1. Financial conversations at home with family or in school, etc. are not that common.

  2. Lack of financial independence to women in Indian households. They are entrusted with managing only home expenses and budget and their involvement in actually managing the overall finances is considered unnecessary.

Before we can talk about how we can resolve this, it’s important to pause and understand why its even important for women to become part of these discussions if it isn’t causing any turmoil.

  • Most of our life decisions revolve around what the money in our bank account looks like. Whether its marriage, taking a sabbatical, starting a new business, plans to travel and retire, all depends on the shape of one’s income and saving.

  • Shruti has both experienced and observed in her experience that God forbid when something happens to the man of the house, the family is left to deal with not only grief but also chaos and uncertainty due to a lack of awareness of one’s financial situation.

Essentially, managing your money equals managing your life and that isn’t something we must choose to not play an active role in.

How can we train for this role?

1. Keeping track:

Step 1 is to keep a track of our income and all expenses. It’ll help us in:

  • Identifying the categories where we are overspending

  • Keep a track of our savings

With a personal example, Shruti talks about how online shopping was her red flag and when she stepped into entrepreneurship, she deleted all the shopping apps from her phone to curtail these expenses. Just being aware of your spending habits, could be the beginning of making change happen.

2. Creating an emergency fund:

Step 2 would be to start accumulating an emergency fund. A fund apart from taxing saving or insurance related investments, something which is very less risky like an FD.

The thumb rule for determining an emergency fund is either to take 3 months’ of the amount that comes to our bank account or the amount we are taking home or a total of our 6 months of expenses.

However, Shruti mentions that she believes that thumb rules do not always work and it is better to plan your emergency fund according to your own specific needs such as:

  • Dependencies like parents, siblings, etc.

  • Medical fitness or health

  • Career plans, say if you are planning to start your own business

3. Minimize risks:

Step 3 is to control risk in the environment like taking a term plan in health insurance.

4. Awareness and Exposure:

Make a habit of reading financial news. Today, there is an option available for every reading style, be it podcasts, blogs, social media channels or the good old books. For our book lovers, she recommends ‘Let's Talk Money by Monika Halan’.

5. Conversations:

One of the smallest but most important change we can make is making money part of our dinner table conversations.

Every family member should be more aware of savings, investments, spends. It should no longer be a solitary discussion for the ‘man of the house’.

As you begin this journey, Shruti warns us of a few common mistakes she has observed that you can now avoid:

1. FOMO investing:

She explains that at times, people just jump-start on investing as there is so much FOMO involved. Crypto is a great example of this behaviour. She advises taking a top-down approach to investing where the objective and goals are very clear before we leap into just one particular investment that is gaining popularity.

2. Life Insurance policies:

People in India are highly mistaken about life insurance policies. The common perception is that be it in any case, you would eventually get all the amount back which isn’t true.

3. Dependence on corporate health insurance:

A lot of salaried people depend on corporate health insurance and end up having no health insurance after retirement.

4. Magic of compounding:

She presses on the fact that people miss out on the magic of compounding as they mostly pull out their investments during an economic downturn. She has also observed this constant need among people to keep doing something with their investments. Sometimes, we do not need to do anything with the investments. She further explains that another reason why people miss out on compounding is the inability to visualise for long term as opposed to short term gains.

To end our conversation, we want to take you back to the very definition of financial independence. It is a stage where even if we stop earning, we have enough money for our entire life’s expenses. It is the time when we can enjoy life on our own terms. This is your only indicator of true financial independence. Not what you see on social media.

Looking rich is different from being rich.

And as you can see within this definition, it is very custom to your own expenses and savings. Your inflation rate depends on the lifestyle you entertain. So it's fair to say, one size does not fit all.

Listen in to our full conversation with Shruti here.

You can also book a 15 minute meeting with Shruti here.

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