Why Can’t A Woman Be More Like…

8
Dec

Remember that somewhat, um, dated tune from the 1956 hit musical “My Fair Lady?” Henry Higgins repeats over and over again in a doleful refrain: “Why can’t a woman be more like a man?”

While the point of this post is not to dig deep into the show’s 1950s-era perceptions of gender differences, the issue of how men and women behave differently with investing in the present day is a key issue in women’s financial security.

Study after study shows that men tend to be more confident than women when it comes to investing. To be clear, that male confidence is not always aligned completely with competence and success in the markets. Even so, the under-confidence some women exhibit with investing can be particularly damaging to their wealth creation. The issue is that it leads to underinvestment in risky assets needed to provide the level of return necessary to create wealth for a secure retirement, and other needs.

The best way to deal with a lack of confidence for women of all ages — this can start as young as a teen, and go through to those who are retired — is to self-educate, stay current with the markets, and work with professionals who collaborate in that process. Knowledge is power, as we know, and understanding how markets work, what is going on in the economy today, and speaking with experts who are themselves knowledgeable and confident enough to be collaborative in the investing process, is the key to greater confidence. That greater knowledge and confidence should lead, hopefully in short order, to higher returns and healthy wealth development.

Here are some tips to try for investors of all ages:

1. Self-Educate: Learn the basics of investing and markets, and how the economy works. Believe me, it’s easier than it may sound. But you can’t really know the specifics well without understanding the big picture. Take a class or two, read high-quality books, or seek out possibilities online, including webinars, and other web-based instruction. Find something that fits your schedule, and stick with it. For the younger crowd, make sure your girls are being educated about money from a young age. Starting young will help create a stronger foundation of confidence and understanding.

2. Stay Current: On an ongoing basis, read high-quality financial publications. This could be newspapers or websites, on a daily basis, that engage high-quality journalism to explain what is happening around the globe, and how those occurrences in turn impact markets, and eventually, your financial security. You need to understand what is happening in the world, and in the markets, and how it is impacting your money now and over time.

3. Engage: Start putting your money to work. For the younger set, this means working with parents to invest small amounts of money, or learning more about the money that has already been invested on their behalf. For the over-21 crowd, start with your 401(k). Know if you have one, know what’s in it, and follow a strategy that is appropriate for your age and saving goals. Follow it on a quarterly basis, and re-balance it every year based on your investing strategy and long-term goals.

4. Collaborate: If that last part about investing, strategy, and goals sounds daunting, or if you are interested in doing investing in addition to your 401(k), try working with an expert. As we have discussed in this space, we all have our areas of expertise, and you don’t have to be an expert in all things. When you look for an expert to help you with investing and wealth management, make sure you find one who helps with your learning process, and collaborates with you in the process. This person can coach you, and be a partner in your development as a confident investor.

 

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