Financial adversity can strike anyone at anytime and at any quantum. And when it strikes the whole family’s future start looking bleak. And especially in case of women who are totally dependent on husband’s income the impact is severe.
There could be many reasons for financial adversities such as:
- Death of husband who is single breadwinner of the family
- Partial disability of the lone earning member of the family
- Medical problems
Few of the financially stressful situations for a homemaker in an event of husband’s death are:
- Children’s education and marriage
- Repayment of any ongoing loans or credit card bills. Most importantly home/car/personal loan.
- Medical treatment
In order to have a financially secured future, women should insists her husband to make following financial decisions as early as possible. And husband, at the same time should practically think about these decisions and act swiftly.
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List all the investments: It is every women’s right to know all the investment done by her husband. Be it stock market, mutual funds, fixed deposits, etc. At the same time it is essential for a women to have complete understanding of investments, its objective, returns, etc.. This knowledge will help when the husband is no more so that women can take complete ownership and make right moves.
Understand importance and meaning of every investment: Not everyone has financial acumen to understand details of investments and its confusing terminologies. As these are the concepts which are difficult to understand. However this does not mean that you should not involve your wife in matters related to investments. Although she may not understand everything but she will understand something which will definitely come to her help in your absence. So it is the wife’s duty to get acquainted with basic terminologies. And remember knowledge gained is never wasted. It can help in someway or the other. If not now, but definitely it will help in future.
Get yourself added as a nominee: Individuals often make a mistake of not adding nomination. Make sure wife gets her name added as a nominee in bank account, insurance policy, and all other investments such as ELSS, fixed deposits etc. Let’s take an example of fixed deposit when nomination is not made. In this case, family members will have to bear the pain and produce legal heir proof or a succession certification to the respective authority in order to get maturity amount.
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Open joint bank account: Another important financial decision women should ask her husband to make is – open bank account jointly. Having jointly held account with partner has many benefits such as keeping track of all expenses, both can operate the account. And most importantly in case of death, the rights can be transferred easily. There are many types of joint account in India. But husband and wife should open (Either or Survivor) type of joint account. And it is highly recommended for newly married couple to open such type of account right after marriage.
Buy health insurance: No matter how healthy a family eats or lives, health problems are inevitable. And buying a medical insurance is the most essential for every family. A single hospitalization can suck entire life’s savings. And especially when the only earning person in the family gets hospitalized then entire onus comes on wife. Having sufficient health cover can protect your savings as the insurance company will pay for the pre and post hospitalization expenses. And very small amount will have to be paid by the family.
Buy term insurance plan: What will happen in the absence of the breadwinner of the family? Who will take care of children’s education or marriage, day to day expenses? This is where term insurance plan comes to rescue. In an event of death or critical illness to the earning member, the insurance company protects the family by paying out the sum assured to the family. This assured money can then help in meeting expenses of various life events. This is the reason every homemaker should ask husband to purchase term insurance cover.
Buy child plan: Everyone wants their child to get best education. However with rising cost, it has become increasing difficult to provide such type of education. And in the absence of earning member, this becomes impossible when wife is not working. However child insurance plan offers periodic payments as specified under the plan and all future premiums are waived off as policy continues to remain in force. So wife should actually get this very essential plan purchased.
Write a will: All of the husband’s assets should fall into the right hands after his demise and most importantly in a smooth manner. Assets could be – house, shop, company, gold/other forms of jewelries, etc. Each of your family deserves equal rights to inherit the wealth. And this is when will writing is beneficial. It is therefore the duty of the husband to create the will and add wife and/or children as a beneficiaries. This wealth will then help to meet future expenses of the family. In cases where will is not made, family has to go through legal route and claim the wealth. And this is a very tedious process due to the complexities involved.
Plan investments jointly: Normally wives have conservative thinking when it comes to spending money. So if husband is doing investments aggressively, then best is to decide on making investments jointly. This way, husband won’t end up buying incorrect financial product.
Get access to all documents: Make sure you as a wife is aware of all the documents related to investments, properties, loans etc. If you do not know where these documents are kept or when to use what, then ask your husband to simplify each and every document and its importance. Best is to use digital locker.
Share passwords: This is the most critical thing and requires high level of trust. But being a couple, there should not be a single percent doubt. Sharing of passwords is a key especially when investments are held in electronic form such as equities, mutual funds etc. If husband dies then it will become very difficult for the wife to take a control of them.
So securing the financial future of the family requires trust between both husband and wife. And this most critical aspect should be handled with responsibility by both of them. It is no longer a one person job.