Taking a seat at the investing table… leads to financial independence.
The pandemic’s impact on women investing.
Women historically have shied away from investing in the stock market, and would prefer to save their funds versus invest it. There are a number of reasons for this, which include having no knowledge about investing, being scared of losing money, believing there is no time to learn about investing and finances, believing that it takes too long to realize a return, and believing that investing is simply a “guy” thing. But women do themselves a huge disservice by not investing in the stock market.
This needs to change.
Taking a seat at the investing table… leads to financial independence.
Investing is critical
As we have outlined, to simply keep up with rising prices, i.e. inflation, and maintain the same or better standards of living, you must invest. See “Inflation is the silent killer of your financial wealth.” In addition, you simply will not be able to keep up with inflation with keeping your money in savings. See “Long-term value of $1 invested vs. long-term value of $1 saved.” Not only that, you must have a long-term perspective. See “Overlook short-term volatility in favor of the long-term trend.”
In fact, besides starting your own company and either selling it, taking it public or growing it organically, or owning real estate, there is no better way to systematically and continuously grow your wealth than by investing money. You want your money to work for you. See “Put your money to work by investing it.” And you don’t need to spend much time on investing either. See “No Time for Research? Invest in an Index...”
So, what’s holding women back?
Women, by nature tend to be risk-averse. This, in combination with the fact the women generally are not exposed to finance and investing while growing up, have manifested in women generally preferring to keep any excess funds in savings “for a rainy day” and not taking advantage of investing, because of their beliefs that:
“Investing is scary”
“I don’t know anything about investing,”
“What if I lose my money by investing?”
“I don’t know how to start”
“I don’t have time to learn how to invest”
The silver lining in the pandemic
But, reports now show that during the pandemic, women started investing and “roughly two in five current women investors” started investing in 2020 or 2021. (source: eToro)
Research from Fidelity shows that half of all women became more interested in investing during the pandemic. In fact, according to Fidelity, as per its’ 2021 Women and Investing Study, 67% of women are now investing outside of retirement, up from 44% in 2018. Interestingly, this includes 71% of millennials (ages 25-40), 67% of Gen X (ages 41-56) and 62% of Boomers (ages 57-75).
Why is this important?
Because while you should be investing at any age (See “It's never too late to start investing. Just start”, the earlier you start investing, the more time you give your wealth to grow. See “Compounding is magical” and “Time is your friend.”
Ready for Action
The Fidelity Report also shows that 9 in 10 women plan to take steps in the next year to help their money grow and learn more about the mechanics of investing. This is great!
BUT
Only 1 out of 3 women see themselves as investors. And if given $25,000 to invest in the stock market today, only 47% of women say they would know what steps to take get started. This needs to change. This lack of knowledge is across all income levels, but especially pronounced at the lower levels, where 36% of women with income less than $100,000 say they know what steps to take to get started investing, while 49% of women with income greater than $100,000 say they know what steps to take to get started investing.
This needs to be 100% of women across the board knowing what steps to take to get started with investing.
What is holding women back?
The majority of women, 70%, say that to invest, they would need to know more about picking individual stocks, while 65% of women say they would be more likely to invest if they had clear steps on how to do so.
And 69% of women wish they had started investing extra savings earlier. There are serious consequences of not investing earlier, such as:
inflation eroding the purchasing power of your money
stressing if you will have enough money at retirement
trying to meet daily expenses
trying to provide for a family and their needs (and wants)
In fact, women tend to prioritize their children over themselves and women are the first ones to cut back on any necessary spending for themselves in favor of their children and even their partners or spouses. Taking control of your finances and ensuring that you are doing what you can to grow your wealth helps you to reach your goal of taking care of not only your children’s and partner’s needs, but also your needs as well.
Fidelity’s report also found that women feel more confident about investing when they:
invest consistently
select diversified products
take a long-term approach to investing
start early
educate themselves about finance and investing
We strive to meet each of these actions. And in fact, have posts related to each of these topics, and so many more.
Invest consistently
Select diversified products
Take a long-term approach to investing
Starting early
Educating themselves about finance and investing
The impact of the pandemic has been horrific for so many people and life as we know it has changed. However, being able to take the positives of the impact of the pandemic and realize what needs to be done will make everyone better for it, especially as it relates to the importance of money, having money, keeping money and growing your money.
Our mission
Our mission is to help women not only take that seat at the investing table, but also take a leadership position as it relates to their finances and investing. Take a look through our Substack posts, our Instagram, our website and our products, such as courses and publications, and our services, such as group and 1x1 coaching. Download our free pre-investing workbook. And let us know how we can help you become more confident about investing.
Remember, two posts that will motivate you to start: “The Fearless Girl” and “I AM AN INVESTOR. Make it your mantra.”
**Note: Almost all of the data in this post is taken from Fidelity’s 2021 Women and Investing Study.
“There's never been a better time for women to take their seat at the proverbial table. By learning about investing, women can gain both the confidence and competence to become financial change agents.” - Linda Davis Taylor, CEO and chairman of Clifford Swan Investment Counselors
“For women, financial independence is a matter of necessity.” - Carrie Schwab-Pomerantz, board chair and president of Charles Schwab Foundation, senior vice president of Charles Schwab & Co., and board chair of Schwab Charitable,
“Being financially literate is a powerful thing, especially for women” – Otegha Uwagba, author
“Give a woman a dollar, and she can put it to good use. Teach her about how money really works, and she can change the world.” - Linda Davis Taylor
“Take responsibility for the fact that you created everything in your life via your thoughts, beliefs, focus, actions, and energy and that you have the power to shift your mindset, raise your frequency, and create new things that will serve you better. Get out of your victim mode and into badass mode and be diligent about your mindset.” – Jen Sincero, writer
Key: Taking a seat at the investing table… leads to financial independence
Check out our website SHALnCO for more resources on investing, including courses and eBooks.
Nothing in this email is intended to serve as financial or investment advice and you should do your own research and consult with appropriate advisors.