There are a few things in life we wish we wish we understood better. Investing is one of them. But, why? It’s no secret that women are better money managers than men. In fact, according to a report from the National Institute on Retirement Security, women have overtaken men and now control more than half of all U.S. wealth and will likely take an even bigger piece of the pie in coming years.
So why is it that so women across all age groups and races, have considerably less retirement income than men? Consider this: for starters, we live longer (ahem: 81.2 years versus 76.4 years, according to statistics from the United States Department of Health and Human Services), we also take more career breaks, pay more for comparable products—and we often put our own needs last. For example, we choose to save for a child’s education over our own retirement, according to The New York Times. But, none of these factors is as big a deal breaker as what I’m about to share with you.
You might want to pour yourself a glass of wine before you dive into this. Because it’s a lot.
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The one big financial mistake women are making today is actually the easiest one to fix. The problem is that we as women don’t invest our money as often as men do. We know that investing is smart, but launching that investment plant is something that many women struggle with—including those at the top of their field. Ellevest is aiming to fix that. Ellevest’s software takes women’s unique set of goals into account when coming up with goal estimates. To gain a better understanding of how to start investing in our 20’s and 30’s, we reached out to Ellevest CEO and co-founder Sallie Krawcheck for her valuable knowledge on power, financial feminism, and closing the gender investing gap.
According to the investment-management guru (true story: she led Merrill Lynch, Smith Barney and Citi Private as CEO), investing now can actually have a bigger impact on your financial future than boosting your salary by 30% (yes, really!). “The most important thing about learning how to invest is that investing should be a habit, not a one-time thing, and the best way to invest is to put a bit out of each paycheck every month,” she tells Style Salute. Think along the lines of compounded returns. “Returns” are what they sound like — the money you invest comes back to you from market gains or losses.
The second most important thing about investing, Krawcheck advises, is to start investing as soon as you can. “You’re never too young to start investing: money compounds over time, which means a dollar you invest when you’re, say, 26 is more valuable than one you invest when you’re 32. If you’ve been putting off this crucial task of investing, now’s the time to quit procrastinating—Ellevest today released a (free) guide for women on the smart way to break down your monthly income so you don’t keep waiting to invest. Written by Krawcheck herself, “The Go-Getter’s Guide to Investing” is a free click-through guide that focuses on the five most important things about investing, from how to choose a financial advisor to how to budget your income.
The Guide provides “real world” examples with a clear, relatable voice so you can take control of your finances and feel informed and confident about investing your money. Plus, it promises you’ll learn the basics in just about 20 minutes.
So, take out a pen and paper and get ready to take control of your finances with the 5-step easy-to-read “Go-Getter’s Guide to Investing.”
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Next up, asking for a raise? Here are 5 ways to figure out if you’re underpaid — and get even.
It’s time to close the gap for good. Sign up with Ellevest today for advice on approaching investing.
Disclosures: We’re excited to be partnering with Ellevest to start this conversation about women and money. We may receive compensation if you become an Ellevest client.