Invest Smart 2024: Financial products every woman should invest in

While India has experienced a notable rise in the adoption of financial products in recent years, female participation in this domain continues to lag behind.

In the latest episode of Invest Smart, Editorji's Avni Raja discussed this disparity with financial expert Mrin Agarwal of FinSafe. The duo focused on the importance of financial products tailored to women's needs, emphasising health insurance and equity funds as essential components of a well-rounded investment strategy.

Significance of Health Insurance

Agarwal, known for her advocacy in women's financial literacy, stressed the significance of health insurance in safeguarding against unforeseen medical expenses. She highlighted a concerning trend revealed in a recent survey conducted by her company, FinSafe, indicating that many women overlook the need for adequate health coverage, often relying solely on employer-provided insurance.

Agarwal emphasised the necessity for women to secure personal health insurance policies, recommending coverage ranging from Rs 10 to 20 lakhs to mitigate potential financial burdens associated with medical emergencies.

"The first thing that I would say is that women need to have at least Rs 10 to 20 lakhs (cover). And why women, I'm saying? Generally a family of four needs to have at least Rs 10 to 20 lakhs of health insurance cover given the cost of treating large illnesses, right? And of course, do not rely only on the employer cover because in case of separation from the company, how are you going to ensure that you have the continuity of the cover then?" said Mrin Agarwal

Discussing the intricacies of health insurance selection, Agarwal cautioned against opting for policies solely based on affordability, urging women to scrutinise policy wordings for exclusions, sub-limits, co-payments, and waiting periods for pre-existing conditions. She also advised against relying solely on corporate policies, emphasising the importance of supplementing them with personal coverage to ensure continuity in case of job changes or separations.

Investment in equity funds

Talking about investment strategies, Agarwal underscored the role of equity funds in wealth creation, and highlighted the need for women to invest strategically to combat inflation effectively. Citing survey data, Agarwal underscored divergent attitudes among women towards equity investments, ranging from risk aversion to a desire for active stock trading. She advocated for a balanced approach, recommending mutual funds managed by experts as a prudent investment avenue.

Agarwal recommended a minimum investment horizon of 7 to 10 years for equity funds, cautioning against attempting to time the market. She advised investors to align their investment decisions with their risk tolerance, urging consultation with financial planners to navigate the complex landscape of financial products effectively.

"I would say that, you know, if you absolutely don't know where to invest, then an index fund or a Balanced Advantage fund or a flexi cap fund, these all three are a good starting point", said Mrin Agarwal

In conclusion, Agarwal emphasised the importance of informed decision-making in selecting financial products tailored to individual needs. By prioritising health insurance and adopting prudent investment strategies, women can secure their financial future and achieve long-term financial independence.

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