Nowadays, women are taking leading roles in the workforce. In many households they are breadwinners and collectively generate substantial wealth. Being mother is even tougher. Not only are they one of the breadwinners and parent, they are also responsible for all the household chores. As they become more assertive in the workforce, it is imperative that they also become more confident in managing personal finances. However, while prioritising tasks, inevitably, it's financial planning that comes last on the list. Unfortunately, one really can't afford to do that. Planning is vital for the financial health of the entire family.

One big problem is that today people live in a world of plastic and, for all practical purposes, we do not respect or understand the value of cash. Easy access to consumer credit and multiple means of payment, ranging from credit cards, online bill payments, cheques, and automatic deductions from salary and bank accounts, have all contributed to a cashless system that loosens the control on total spending. On many occasions, our impulses get the better of us.

Very often, we spend our hard-earned money guided by our feelings instead of reason and rue our decision later. Many a time, by spending indiscriminately on the child we end up seriously undermining our own and our child's financial stability. Financial planners will confirm that this is reason enough to start worrying. For it's the unplanned and easily forgotten expenses that can run the best laid financial plans aground.

But before you begin the journey to financial freedom, determine where you are financially. Make an approximate, if not exact, assessment of your assets and liabilities. In case your assets are greater than your liabilities, then you have a positive net worth or else you have a negative net worth. In this case, the choices are to cut expenses, increase income or do both.

HOUSEHOLD BUDGETING

It is widely felt that if we understand and follow the basic principle of "Household Budgeting," we can change our life forever. Our life will be less stressful financially and we shall be taking our first major step towards "financial peace of mind". It is an easy principle to understand; however it may be diffIcult to follow. The best way to sort out one's financial life is to budget expenses. The crux of budgeting is to know your monthly spending needs and habits.

Track your cash flow to see what comes in and what goes out. So, first take account of the post tax take-home money that you earn. Then collect all your bills, credit card statements, cheque book statements and receipts for anything you buy with cash, whether petrol, LPG, groceries or takeaway Chinese. At the same time, you should be able to log in expenses under major heads like school fees for the period. Clothing, eating out, entertainment and holidays are heads of expenditure which need to be carefully watched.

One must try one's best to keep spending on these items within the limits imposed. You must also monitor your ATM withdrawals, decide how much to take out each week and stick to it and then make it last. The idea behind the whole exercise is to rein in spending: if loose spending is to be done, do so from the profits generated by you from your investments, not income.

MINIMISE SUDDEN CASH BURDENS

Typically living a credit-fuelled life means you are leveraging your future income. But while following the system of using cash for purchases, once you have used all your cash, there will be no spending until your next paycheck. This is tough! No credit/debit cards?

Another way is to get two sets of envelopes, one for monthly needs like food, medicine, utilities and the other set for periodic payments like insurance, property tax or gifts. Put the exact amount allocated for monthly spends into each envelope. When you need groceries, for example, take the labelled envelope along, so that you know how much is spent and how much is left over for the rest of the month.

There is no question then of overshooting the budget. For periodic payments, divide the annual spend by 12 and put away the required amount every month. Make sure you allocate enough money to pay your rent/mortgage, utilities and any other fixed expenses you may have. This way you also minimise sudden cash burdens such as a tax payment rearing up at the end of the year. Do this for as long as it takes to grasp budgetary discipline.

PRACTISE SAVING

Many people also practice the simple yet very effective technique of saving. So start saving, at least 10 per cent of your income. Less will do, as the idea behind it is to get into a savings habit mode. Once into the habit, save consistently and increase the amount as per need. You will have to find many new ways to manage your cash and the first few weeks will be the toughest. You may even run out of cash before your next payday. However, after several weeks, it will get easier to manage your cash and you will be surprised to find extra cash available before your next paycheck.

GENERATE INCOME FROM SAVINGS

Once your budget has created a pool of savings, view it as an investible surplus that you now need to begin working on. Make your money work for you by investing the accumulated surplus and you will find that the returns generated have come handy for you one day. Review your investment surplus periodically to ensure that you are not missing chances to accumulate more.

SUMMARY

Proper planning for future financial needs is critical to financial security. We all need to watch where our money is going during any given period of time. For people who have ample wealth, the exercise is optional. But for the rest of us, we have to do this because our money is going astray. Very often it is used up for obtaining objects and services not truly important to us and completely out of sync with our long-term financial goals.

Here are a few tips to take care of overall financial planning:

- Budget for immediate expenses with a contingency fund that covers living expenses for four months.

- Insure life and medical expenses

- Leverage debt to build long-term assets like a home.

- Invest for your child's education and your own retirement needs.

Ignorance is not bliss when it comes to money matters. People should be aware of the investment avenues, which can enable them to manage money. We should spend on luxuries but at the same time keep some money for rainy days. We should save and not spend recklessly keeping in mind the uncertain future. It calls for development of a sense of discipline to overcome the urges.