Since 1995, March has been designated as Women’s History Month. What started as Women’s History Week in 1981, was expanded to recognize the contributions of women. With each passing year, women have demonstrated their effectiveness as leaders in business, government as well as in their homes with the ability to manage their budgets and finances as they’ve come into their own as female investors.
It isn’t easy – even now. According to the Workforce 2020: Women and Well-Being Study by Guardian Insurance, despite the strides in the workplace, 64% of women say money is the leading cause of stress. And, only 1 out of 5 women consult a financial professional.
So, how do self-directed women create the vehicles that allow them to build wealth and security so they can live well, save for retirement, and along the way, support other women? I have ideas to share.
Real Advice for Female Investors
There’s a real skill to building a portfolio; it takes the ability to do research, be patient and disciplined, and know yourself. The last attribute may be a surprise to you, but this is one of the first places a professional financial advisor will start with a client, (hint – we start here and so should you!)
When advisors first sit down with you, we want to know about your goals, the timeline for accomplishing them, and your risk tolerance. The answers to these questions will largely determine the investment vehicles we suggest for you.
For instance, you may want to save for your retirement, collect enough money to establish a new business, put a down-payment on a house, or fund your child’s education. Or you may want to build wealth or do all of the above.
While there are ample vehicles for saving for retirement and your kids’ college that allow money to grow tax-free in relative safety. If you’re behind on saving and have a relatively short timeline, other vehicles that could speed up your return on investment (ROI) may be considered.
And we also want to know if you’re someone who will worry about losing money if there’s a little market volatility (hint – volatility happens); or are you someone who shrugs your shoulders when the market moves up and down like a tsunami wave? We want to put your money in an investment vehicle that allows you to sleep at night.
When you pay attention to all of these determinants, then you can look at where to invest.
When you’re building a portfolio, be patient. Sure, you may be feeling pressured because retirement feels like it’s just around the corner – know that you can’t force the market to cooperate with your timelines. If you think “long-term” when you’re looking at investment vehicles on your own, you’ll likely do better.
In a previous article I wrote about women investors last year, I cited a study that shows that although they are slower to get into the market as investors, women in investing do better than their male counterparts. It’s because they tend to be more patient and choosier about taking on unnecessary risks.
When you prepare to fund your retirement or achieve the majority of your investment goals, your mantra should be, “Be the Tortoise.” In the fable about the tortoise and the hare, the tortoise was slow and steady, and she won the race.
Invest in Yourself
Did you know that since 2007, women-owned businesses have grown by 58%! There are more than 12 million women-owned businesses in the United States and they generate $1.8 trillion in revenue and employ more than 9 million people. That’s impressive economic power!
What’s even more impressive is that women-owned businesses represent 42% of all businesses.
One of the proven ways to build wealth to fuel your portfolio is to be your own boss. Even if you don’t want to give up your day job to become a full-time entrepreneur, how about becoming a “sidepreneur” by starting a part-time business on the side?
There are tax write-offs you can take (possibly a percentage of your dwelling if you work out of the house or a percentage of vehicle costs), and you can stack up more cash to fund your investment vehicles.
Invest in Each Other
The ultimate way for women to celebrate and empower other women is by investing in businesses that are owned or managed by women. A few of the women CEOs who run Fortune 500 companies include Mary Barra of General Motors, Carol Tome of UPS, and Sonia Syngal of Gap, Inc.
If you’d prefer supporting smaller businesses in your community, consider shopping at stores and businesses owned by local female business owners – your patronage may make all the difference.
At the beginning of this article, you learned that 64% of women were stressed about money – but only 20% of women consulted a financial professional. If you’re finished with worrying about your financial future and would like to find a female investment professional who takes a consultative approach to building your portfolio, I invite you to contact me.
Like all of the advisors at Stableford Capital, we are fiduciaries, which means that we will suggest the strategies that are in-line with your goals and your risk tolerance. You’re welcome to reach out to me at 480.493.2300 or contact us about our 15-minute free consultation.