The more you know about investing, the more confident you’ll be about making decisions.
None of the factors that define you — your age, marital status, education, or occupation — limits what you can learn about investing or the uses to which you can put your investment knowledge. What’s more, the difference between women who make the most of investment opportunities and those who don’t isn’t necessarily the amount they invest. Most of the time, it’s how carefully they plan, how soon they start investing, the investment choices they make, and how consistently they stick with it.
Putting knowledge to work
Learning investing, like learning anything else, works best when you put your knowledge to work right from the start. It might help to compare learning about investing to learning how to handle a job or play a sport. You certainly weren’t born with those skills, and chances are you had some help on your way to mastering them. But you did it. The same is true of learning about investing.
For first time investors:
Identify a goal and the type of investment that may help you reach it — perhaps a mutual fund or stock.
Narrow your choice to a specific investment by talking to your financial advisor.
Invest promptly, reinvest any earnings, and add new money regularly.
Track how well your investment performs by checking its return online, perhaps monthly or quarterly, and comparing that return to its benchmark index.
After a year, evaluate how well your investment has performed in comparison with similar investments, with how well you expected it to do, and with what you had been earning on your money before you invested.
If the investment is meeting your expectations, keep building it systematically and add another one. If not, consider a different investment.
The value of advice
You can approach investing in a number of ways. If you have clearly defined goals and the time and knowledge to do your own research, you may prefer to make your decisions independently. But if you’re new to investing or know it’s time to move what you’ve accomplished to the next level, you’re likely to find the help of an investment professional invaluable.
An advisor can help you clarify your financial goals and estimate how much money you’ll need to meet them. He or she can explain types of investments that may be appropriate for helping to turn those goals into realities and describe the risks and potential rewards of the choices you will need to make.
The more you know…
Research conducted by a number of firms has confirmed that in the past women have tended to invest too conservatively and therefore less profitably than they might have. But women who are more confident about their investment knowledge regularly commit more of their income to investing and are more self-assured in making investment choices. Some of that increased activity is the product of greater commitment in the financial community to meeting women’s needs.
Some of it results from the experiences of women in the workforce, and some from a widespread concern that employer support for people who are retiring is being scaled back.
Part of your responsibility as an investor is to keep learning. New ways to invest emerge all the time, some of which may be appropriate for you. Tax laws change, which may mean rethinking what investments to make for your tax-deferred accounts. There’s little question that staying on top of what’s happening can be a major advantage as you make far-reaching financial decisions.
Should you know where the market is today?
If you don’t track the DJIA or the S&P 500 — the best-known stock market indexes — or aren’t sure whether they’re up or down, should you abandon any thought of investing? Of course not — any more than you’d abandon a trip you’ve planned to a special destination because you haven’t tracked the average temperature there.
The DJIA, S&P 500, and other stock and bond indexes do help you follow how certain markets are doing. But despite the attention these benchmarks get, following their ups and downs isn’t what makes a successful investor. Knowing where your money is, why it’s there, and how it’s doing are far more important.
The Power Of Investing. Complete Guide For Women by Inna Rosputnia
Wishing you a great week!
Want Your Money To Grow?
Subscribe to get free research, trading lessons, and more insights.
(We do not share your data with anybody, and only use it for its intended purpose)