Synopsis: It is ideal for women to empower themselves financially, not just in terms of earning potential but also in being financially literate. Here are some of the steps women should take to ensure they don’t risk their financial wellbeing in case the marriage doesn’t work.
Despite a rise in the number of women in workforce, financial freedom is not easily realised by most, especially after they get married. Women typically lose control of their finances after marriage, either because they leave their jobs, or merge their wealth, or just leave the financial management to their husbands. This can be either a joint decision, or as in most cases, due to family pressure, or after childbirth. Letting go of financial control results in a skewed relationship, where the woman is often left at the mercy of her husband, or worse, to fend for herself if the marriage breaks down. To avoid such a situation, it is best for the woman to empower herself financially, not just in terms of her earning potential, but also in being financially literate and participating in all financial decisions in the house.
“It is crucial that the woman doesn’t give up money management and stays involved in the financial decisions,” says Mrin Agarwal, Founder & Director, Finsafe.
So if you are a woman and truly want to celebrate Women’s Day (on 8 March) this year, make an effort to reclaim monetary control so that you don’t have to depend on anyone for your financial well-being. Even if the relationship breaks down, make sure you are not left high and dry, seeking support from your husband, parents or friends. Take the following precautions to be financially secure after tying the knot.
Don’t merge your finances
Don’t rush to close your pre-marriage bank accounts to open a joint account and merge your wealth with that of the spouse. “Make sure you have a single account in addition to the joint account, and even in the latter, be the primary holder. In case of a problem in marriage, the husband can easily siphon off the money from the joint account,” says Dinesh Rohira, Founder & CEO, 5nance.com.
Also ensure that you keep all your assets from before marriage separate and do not encash your investments as soon as you get married. In case of a split, you will have your own financial backing instead of starting afresh. “You should have a repository of all the financial documents from before marriage so that you can control these yourself instead of depending on your father or husband,” adds Rohira.
Don’t leave your job
Don’t be in a hurry to quit work right after marriage, especially if you are moving to a new city. Take your time to search for a new job, or another career option, or even self-employment. Financial independence is critical in the initial stages, particularly in an arranged marriage, to keep the relationship on an even keel and give you confidence to move out if the marriage is not working. Even later, it will stop you from being completely dependent on your husband for your or the household needs. “I was at a senior marketing post at the time of marriage, but quit after having a daughter five years later. My relationship with my husband went downhill because I became totally dependent on him for everything and he failed to take care of my needs,” says Rathi Burman (name changed), a 35-year-old from Delhi.
Even if you face a split 10-15 years down the line, if you keep working or start your own business or provide consulation work, you would have built enough corpus and assets to survive on your own without anyone’s support. In case you do need to leave the job, don’t stop networking with your colleagues and other professionals in the industry. This is crucial if you need to pick up the threads and look for a job on the breakdown of your marriage.
Be a co-owner in a loan
If you are building assets jointly, you should be the co-owner, and if only your funds are being used to purchase assets, ensure these are only in your name. “Even if the woman is earning, the husband usually makes all the investments and could keep the assets only in his name,” says Agarwal. For instance, while buying a house if you are a co-applicant for the loan, make sure that you are also the co-owner. “Even if joint funds were used to purchase a property in the name of a married woman by her husband, it becomes her absolute property by virtue of Section 14 of the Hindu Succession Act,” says Beenashaw N. Soni, Advocate, Delhi High Court.
Don’t sign documents blindly
As a rule, never sign any blank or official document presented by your husband or in-laws without reading it. “Husbands typically open new businesses or make investments in wives’ names to avoid GST liability or other taxes. Women should understand that in doing so they are passing on the risk to the wife,” says Rohira. So, if you don’t find the document appropriate, don’t sign it. If the business fails or faces problems, or the husband is unable to pay the EMIs for a loan in which you have been signed on as a guarantor, the financial liability could rest at your door.
Be financially involved
Always remain active and involved in money management. In case of separation, if you do not know what assets your husband has, or where he has invested, or which ones belong to you, or what your streedhan is, how can you claim it or how can it be included in the alimony? Women tend to let go of financial matters after marriage, and if they get divorced after 15-20 years, they are left penniless because they have no asset in their name, no savings or source of income. “Spend some time to know about the basics of finances, the assets that have been bought and about financial transactions and documents,” says Rohira. Start by handling the household budget, setting financial goals, taking charge of savings and investments and being aware of financial developments.
Buy health insurance
You need to ensure that you are covered under a health plan, whether you buy it yourself or are covered by your employer or your husband’s employer. Mumbai-based Megha Verma (name changed) found herself at a loose end when she required an urgent surgery 13 years into the marriage. They had no health plan and due to the strained relationship with her husband, the latter refused to pay for it. Ultimately, her parents had to chip in while she was hospitalised. If your husband is the only working member, make sure he has a life insurance, with you and your children as nominees. Ideally, the life insurance plan should be protected by the Married Women’s Property Act 1874, so that the proceeds come to you in case of your husband’s death without any creditors staking a claim to it.
Keep streedhan assets safely
Any property or asset, movable or immovable, that has been gifted to you by your family or your husband’s family at the time of marriage or even after it, is yours. “Jewellery and other valuables gifted by a woman’s parents and family at the time of marriage become her property as part of dowry, while all valuables gifted by the husband and his family during or after marriage become her property as part of streedhan,” says Soni. It is, therefore, important that you keep these safely in your possession.
Ask these questions before tying the knot…
1. How will we split financial tasks and expenses after marriage?
Settle this issue beforehand as it can be the difference between a happy and conflict-ridden marriage. If both are earning, split the expenses in proportion to your salary. If there is a single income, manage tasks in a way that you do not lose all financial control. For instance, if the husband is earning, you take charge of investments and savings. If the partner is clear he wants to retain all financial control after marriage, it’s better to steer clear of this relationship.
2. Do you have any loans or debt?
If your fiancé or partner has too many loans, there is danger that he may want to pass on his liabilities to you if you are earning. Do not let emotions make you agree to any such arrangement. Even if he does not have any such intention, too many loans may be indicative either of a low earning power or poor financial management.
3. How are we going to fund the marriage?
Is your boyfriend depending on his parents to finance the wedding, or is he saving for it himself, or perhaps planning to do it with your help? If both of you can agree on this first big financial goal and achieve it without falling out, it bodes well for the future. Discuss with him how both of you can contribute to the wedding without financially burdening your parents.
4. Is your family financially dependent on you?
If the partner has taken on complete financial care for his parents or siblings and it is a long-term arrangement, it is bound to impact your budget and financial goals, besides your relationship. It may also mean that you end up shouldering greater financial responsibility for your family after marriage. You should be clear about what you are taking on and whether it is acceptable to you before tying the knot.
5. What are your financial goals and have you started saving?
It is all right if your partner hasn’t sorted out the last detail about his financial goals, but as long as he is planning and working towards it, you can be assured of a smooth journey. More importantly, however, check if his goals match yours. Does he want to spend money travelling as opposed to the house you want, or does he want foreign education for kids, something you don’t want? Common financial goals can help avoid a lot of financial friction.
6. Do you save before you spend, or vice versa?
If your partner is a spendthrift who doesn’t care about saving or investing, you will have to gauge if he is open to change. Saving before spending is the first step to reaching all your financial goals. If the spouse is averse to changing his spending habit, be prepared for a financial struggle to maintain your monthly budget and achieve your financial goals.