This guide outlines smart strategies for the growing wave of women investors who are seeking to secure their futures,
The financial trends are clear; women are becoming investors in advancing waves of change. We’re not talking about those little waves that lap over your ankles; we’re talking about massive rogue waves that roll up onto the beach with authority and verve.
It’s not entirely clear why women investors are investing more in 2023 than ever before; perhaps the pandemic offered a steady stream of educational options, or women have higher income levels than ever before, or maybe women have recognized the value and power of making informed decisions about investing. What is evident now, for any number of reasons, is that women are becoming investors in a variety of ways. Let’s discuss, shall we?
The word “strategy” needs to come to the forefront of this discussion, regardless of who’s doing the investing. A strategic inclination is required with each investment and a bold move is the one that follows. Do women inherently hold strategic inclinations? Oh, yes. No doubt there.
Watch a woman play a bracing round of golf in an alleged-social foursome and you’ll see some strategic inclinations chip perfectly onto the green. This, then, is the time. It’s the year of the woman investor making some choices in investment for purposes that may be known to herself alone, but she’s exercising both her strategic inclinations and the bold moves that confirm her choices. If the number, 7, is the lucky one; it only seems appropriate to use it now.
7 strategic practices for women investors
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Learn to Earn
Many women earned more money in 2022 than ever before. What will you do with it? It is time to learn or refresh your learning in the study of Investing 101 so that you’ll earn more from your investments. Frankly, the more you know about the permutations of investing; the more you’ll be prepared for the information that follows your first “buy” button investment. The following are a few key terms and practices to learn before you invest:
- Stocks and bonds (the difference is…)
- Inflation (toddlers learned this term in 2022)
- Purchasing power (the reason why we know what “inflation” means)
- Investments (short-term/long-term)
- Investment advisor
- Broker-Dealer
- Compound interest
- REITs
- Brokerages
- Mutual funds, index funds, exchange-traded funds
- Roth IRA vs traditional IRA
- Sign Up Today
If your workplace has a retirement account plan with matching funds; for goodness sake, please jump in. This is a win-win for women investors and one that adds to your funds on a consistent basis. Buy in at the highest level possible; add-in additional sums, if allowed, and take your employer by storm.
- Maintain Your Balance
Not a single person I know wants to hear, “Don’t get all emotional” when it comes to warnings regarding the volatility of investing. Your investments will rise in value and they will retreat in value; that’s the way it is. Some will offer outstanding results; others will be dust in the wind. Maintaining one’s emotional balance when investments move is a practiced art and one we learn along the way. So, don’t get all emotional.
- Get a Study Partner
If you are seriously considering investments for your retirement or other large asset allocations, you will want to consider aligning with an investment broker who can purchase or sell securities and has access to a broker dealer platform in an investment bank. A broker dealer is paid by commission and is regulated by FINRA. An investment advisor is not allowed to make trades on behalf of clients, but may offer suggestions for purchasing or selling stocks. Advisors are regulated by the SEC.
- Maintain Investments
If you’ve experienced some losses in investments, it may be tempting to drop out of the stock market at some point (see #3). This will translate to a probable loss and possibly negate your self-learning along the way. If you’ve experienced losses, consult with a broker to make the necessary changes and then back away from your computer.
Decide to check your portfolio no more than once a week and don’t peek at any stock-related news. Those women investors who check our portfolios three times daily are headed down a dark road and we know it. Manage and maintain your investments and you’ll be satisfied with progress in the end.
Here are some interesting facts: the average stock market return over the last 30 years in the U.S. was 10%. When adjusted for inflation, it was around 6.5%. These returns are averages with many returns at higher and lower rates. The stock market is notably going to fluctuate, as it is meant to do. This is why it’s important for women investors to maintain their investments without getting nervous and walking away.
- Figure Out Your Risk-Averse Level
How much risk can you handle? We all, men and women investors have differing risk-averse levels when it comes to the idea of losing hard-earned cash. Before you begin investing in stocks, bonds or other securities, give yourself an assessment test by imagining how you’d feel if you lost the majority of your savings in one week.
Stocks, of course, carry higher risk levels because they also offer higher returns. If you decide that you are risk-averse and choose to stash most of your assets in less risky environments, you’ll want to put part of your money into bonds or mutual funds with a guaranteed return at lower rates.
- Pass It On
For decades, women have had few avenues to learn how to acquire wealth, but that is a situation of the past. Wouldn’t it be helpful to younger generations if you decided to pass your investment knowledge on to someone in the next generation? Or, maybe consider mentoring a few younger women investors in an informal class? There will be no better mentor for younger generations than someone who is investing for her future right now. Something to think about.
Conclusion
In this discussion, we’ve been talking about the investment power of women. Women today have more discretionary funds than ever before and they are looking for reasonable ways to increase those funds to finance their futures.There is an advancing wave of women investors in 2023 and it is much, much more than those little waves on the shore. For many reasons, some of them unrecognized, women are seeking to invest; it is a sense of pride and accomplishment that they do so. What is evident this year is that women are now truly investors; just don’t get all emotional about it.
