BT BIG STORY: Women are natural financial planners. But what about wealthy women?

That women are scaling fresh highs in corporate India is well-known. Various surveys peg women representation at the CXO level at 20-21%, up from barely 10% a decade ago. Elsewhere, women entrepreneurs and family business owners are setting new benchmarks. A recent report by Barclays Private Bank and Encubay says women business leaders are set to inherit almost Rs 73 lakh crore over the next decade. In the survey, 86% women leaders prioritise long-term wealth creation; 66% actively participate in investment management.

As women leaders—CXOs and business owners—climb the wealth ladder, managing money becomes a complex affair. It is no longer about just having an emergency fund or risk insurance cover. Larger asset sizes require smart financial solutions.

Radhika Gupta, MD & CEO, Edelweiss MF, gives a framework. “The priorities are a diversified portfolio, money you can access when needed, a retirement plan and clear arrangements for succession. Professional advice can bring investments, taxes and estate planning together. Being successful in your career does not mean you have to manage every aspect of your wealth yourself. But you should understand the plan and remain involved,” she says.

Therefore, it is necessary to dwell into what senior women corporate executives and businesswomen must look for while managing their wealth in terms of investment avenues, advisors, legal angles, planning challenges and solutions.

One-stop Family Offices

For high net-worth women CXOs or family business owners, family offices offer a one-stop wealth management solution. A family office is a private advisory and wealth management entity that handles financial (investment, asset allocation, global diversification, etc), taxation, legal, succession planning (trusts, Wills etc.), and lifestyle needs of wealthy families.

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“The conversation for larger families eventually shifts from managing investments to managing the family balance sheet like an enterprise. This institutional approach is increasingly visible among the next generation of HNIs,” says Akash Hariani, Joint Managing Director at Motilal Oswal Private Wealth.

Single-family offices manage only one family’s wealth, typically Rs 100 crore and above; their operating costs are Rs 2.5-5 crore or more. Multi-family offices manage the wealth of several families. They charge a percentage of assets under management (0.25% to 1.5%) or a flat fee (from Rs 1 lakh and going north of Rs 1 crore annually).

“A multi-family office generally makes sense only for families worth upwards of Rs 30 crore. At that stage, optimisation of tax structures, access to institutional grade alternative assets like unlisted/private equity deals, and seamless wealth transfer become critical concerns. Below that, a good wealth advisor, a lawyer and a CA give most of the benefit at a fraction of the cost,” says Neha Singh, Founder & CEO, Womoneysta, a personal finance platform for women.

“Family offices bring a structured ownership and execution framework, along with curated co-investing opportunities that can be niche and rewarding,” says Vijeeta Sharma, Co-founder, Nexedge Capital, a wealth management and multi-family office firm. Those who do not prefer family offices can consider other avenues.

Multiple Avenues, Instruments

The most critical aspect of wealth creation is asset allocation—spreading investments across equities, bonds, commodities, alternative assets and overseas avenues. This ensures optimal risk-adjusted returns. Asset allocation is even more important for women in business and CXO roles as there is scope for creating generational wealth. The avenues include portfolio management services (PMS), alternative investment funds (AIFs), specialised investment funds (SIFs) and private credit/real estate funds. The ticket size ranges from Rs 10 lakh (for SIF) to Rs 1 crore (private credit, real estate funds). The fee is more than 2%. There could be additional performance-based levies as well.

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Apart from these, even regular mutual funds and bonds can be considered. Fund managers (many of them are HNIs) of mutual funds are required to invest in the schemes they manage. “As wealth scales, families need access to a wider opportunity set—private markets, alternatives, global equities, fixed income, etc. PMS and AIFs can play a role within that framework while overseas investing can provide geographic and currency diversification. AIFs are the access route to private equity, venture and private credit, while PMS is the conviction engine, giving focused exposure to listed equities,” suggests Akash. Singh suggests a core-satellite allocation approach. “The core portfolio of 70–80% can be diversified mutual funds, high-quality bonds and gold, allocated against clear goals. This compounds quietly. The remaining 20-30% is the satellite portion and can include AIFs, PMS, private credit/equity and SIFs.”

What are the issues women face while planning their finances? “Women in leadership rarely lack capability. They lack time. Portfolios get reviewed reactively, between board calls, so rebalancing and tax windows slip. Compounding that, most advice isn’t product-agnostic — it’s pitch-driven, not assessed for asset class fitment, risk-return trade-offs, concentration across portfolios, tax efficiency and honest competitive comparison. What’s missing is disciplined, holistic advisory, not another product,” says Sharma.

Singh suggests a simple advisory structure. “A coordinated team comprising a wealth advisor, a chartered accountant and a lawyer who are aligned to her overall financial plan, together with transparency in fees, are important consideration,” she says. 

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Making Stock Rewards Work

Many large Indian listed companies, global MNCs and prominent well-funded start-ups offer equity—ESOPs (employee stock options) and restricted stock units (RSUs)—as part of the compensation structure.

“A good use of an ESOP is to fund the allocation decided years earlier. A portion for retirement, a portion kept liquid, and the rest diversified. Loyalty to the company and concentration in its stock are different decisions,” says Sailesh Balachandran, Founder and Joint-CEO, Prime Trigen Wealth.

ESOPs and RSUs can be great wealth creators if the firm continues to do well but they also represent a concentration risk—too much personal wealth tied to a single company, that too in equities.

Besides, there is the tax angle. ESOPs are taxed as perquisite—the difference between market value/fair market value and exercise price—and added to your salary when you exercise them. When the shares are sold, capital gains tax also has to be paid. RSUs are taxed as salary when they vest. Employees of eligible start-ups can defer their first tax outgo by up to 48 months. It is important to plan for the cash needed to pay the tax. For listed Indian shares held for more than 12 months, and foreign shares held for more than 24 months, the tax rate is 12.5%.

“We suggest keeping employer stock to 10–15% of net worth. Selling a fixed portion at each vesting and reinvesting it in the core portfolio stops a portfolio becoming a single-stock bet,” advises Singh.

“Treat ESOPs and RSUs as concentrated, illiquid bets on one company. Diversify systematically as tranches vest rather than waiting for a ‘right time, right price’ event. Never let vested equity sit uncounted and passive when sizing the overall portfolio risk,” says Sharma.

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Succession Planning

Once the hard yards of earning and managing wealth are done, the critical final step is setting a smart succession plan in motion. Given that asset holdings are likely to be complex, spread across multiple geographies and at times with multiple stakeholders, the approach of women HNIs should be different. Neha Singh of Womoneysta suggests six important tools for succession planning.

A registered will: This is especially important for Hindu women. Under the Hindu Succession Act, if a married woman dies without a will, her property passes first to her children and husband, and then to her husband’s heirs, before her own parents. Nominations: Sebi now allows up to 10 nominees for demat accounts and mutual funds. Remember that a nominee is a custodian, not always the owner, so the nominations and the Will must align.

A private trust: Ideal for complex asset holdings spread domestically and overseas, needs of minor or special-needs children, a second marriage, or shielding family wealth from business risks. Trusts also avoid probate delays. Term insurance under the Married Women’s Property Act: A policy taken under this Act goes to the named spouse or children and is protected from creditors. That is especially valuable for businesswomen who have given personal guarantees.

A business succession plan: Shareholder agreements, a named successor, key-person insurance and clear separation of personal and business assets.

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An asset map: A single, updated record of every account, policy, property and digital asset, and an open conversation with the people who will need it. Review it every three years, or after any marriage, divorce, birth, death or business event. Sharma of Nexedge Capital also emphasises the need for family governance structures apart from the tools mentioned earlier.

“A family governance document defining each member's roles, responsibilities, transfer of decision-making powers and restrictions as eventual beneficiaries matters a lot. Underpinning all this, active asset register reviews should periodically verify nominations and ownership structures, enabling mindful consolidation of wealth across asset classes, entities and geographies,” she observes.

The Wills should be video recorded to avoid ambiguity and legal challenge risks, she suggests. Nothing should be left to chance. 

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