Ladies, 10 Ways You Know You’re Ready to Invest

Years ago, did you feel squeamish when you contemplated investing your sweat-soaked paycheck?

Now, do you keep hearing things like, “You can’t afford not to invest,” and “Will you have enough for retirement?” 

“Oh, gosh. Will I?” You wonder.

What’s this? You’re swapping your old insecurities for curiosity — or even a willingness to jump on the investing ship and sail on. If this is happening to you, it’s a good thing.

You’re in the majority if you’ve ever felt insecure about investing. Many women have doubts about their ability to invest. This should make you feel better. Fidelity’s findings show:

  • Women earn higher returns. Fidelity’s analysis shows that women performed better than men by 0.4 percent. Doesn’t sound like much of a difference? Actually, over time – it equates to quite a bit of money. 
  • Women are savers. Fidelity’s analysis also found that women consistently saved a higher percentage of their paychecks than their male counterparts — at every salary level! Women saved nine percent of their paychecks and men only saved 8.6 percent of their paychecks. Women also save more in other types of accounts — an average of 12.4 percent compared to 11.6 percent for men.

If you’ve started to d o any of these 10 things, it;s time to run, not walk, to an online broker or financial advisor. 

1. You start asking questions about investing.

Do you seek out that super-smart friend in your life who’s been investing since he was 16? Do you ask your coworkers to tell you about their paying-off-the-mortgage approach? Do you ask all the questions during your company’s retirement lunch and learn (and take allll the notes?)

You might be ready to get serious about investing. Or, if you’ve already started investing, you might want to get more serious and goal-oriented about what you’re already doing. You may want to get more organized!

You might be asking questions like: 

  • How much money should I invest? 
  • How do other people invest?
  • What are my friends and family doing to invest?
  • Which investments are best for me?
  • What are my long- and short-term goals?

By the way, the best thing you can do to get your questions answered is to reach out to a financial advisor (or do your own research if you want to go the DIY route).

2. You have access to a retirement plan.

The minute you have access to a retirement plan means you’re ready to invest. Sorry if that seems abrupt, sister! 

But now’s the time to do it because if you don’t, you may leave money on the table. Here’s what I mean. Many companies offer a percentage on the dollar that you invest yourself.

A pretax account is a great idea because you put your money to work instead of losing part of it to taxes. In other words, you earn a dollar and pay taxes first. 

Check with your company’s human resources office to find out if you have a retirement plan. Then, don’t waste any time. Sign up for it so you get the benefit of your company chipping in money, too.

3. You read things like, “Best Investments for 2020” and “What is a Mutual Fund?”

You know you’re ready when you scroll Facebook over your lunch hour and notice that finance-only posts show up in your newsfeed. Or instead of reading juicy romances, you dive into financial blogs instead. 

Whether you’ve grown up or unfurled a brand new set of interests, what you’re reading signals a curiosity about investing that says you’re ready to invest.

Sometimes that insatiable curiosity leads to your willingness to invest on your own — there’s nothing wrong with tackling investing by yourself. Robinhood, Vanguard and other brokerages allow you to very easily get going on your own — and it’s typically cheaper to do so because you don’t need to pay a financial advisor, or middleman, extra fees. 

4. You think more and more about the future.

You’re playing those “what-if” scenarios in your head. What if… 

  • “I die suddenly and I don’t have a will?” 
  • “I don’t have life insurance to leave my family?”
  • “I run out of money during retirement?”
  • “I can’t retire because I haven’t saved enough?”
  • “Do I really want to bag groceries when I’m 75 — because I have to?”

Do you find yourself thinking about these kinds of questions? Now, they don’t have to be all doom and gloom! Your thoughts can trend toward “what-if” scenarios like this: “What if I want to…

  • live in Costa Rica when I retire?”
  • leave a lasting legacy for my children and grandchildren?”
  • have over $1 million when I retire?”

You’re thinking more about the future. It’s a sure sign you’re ready to invest.

5. You’ve experienced a life-changing event.

You may be fully aware that you need a financial checkup after marriage, divorce or if you recently became a widow. (You know this from your financial literature absorption!) You’re wondering what to do differently, and that’s a perfect excuse to get on the investing wagon.

It’s time to do some research, get a financial advisor, open an account at Vanguard — whatever route you decide to take.

6. You’ve got a stuffed-to-the-brim emergency fund.

Is your emergency fund plump? The rule of thumb is to have at least three months’ worth of expenses in an accessible, liquid account. Read: The money is easy to get to and you can withdraw it at any time without penalty. A money market account or savings account is a great place to stash emergency money — and good for you if you already knew that!

It’s even better to have six months — or more! — of backup expenses. You never know when termites threaten to overrun your home or when a hurricane blitzes through your property. 

7. You end the month with a money surplus.

Got an extra $1,000 just hanging out in your checking account every month? 

Lucky duck. 

It’s time to move it somewhere that sees more action. Where? Anywhere that gives you more returns than a checking account or savings account — but that’s another topic for another day.

8. You paid off all your high-interest debt.

You deserve a giant slushie. The biggest ice cream sundae ever. A gargantuan glass of champagne. 

You sledgehammered your credit card debt or other high-interest debt. 

Once you pay off your high-interest debt, it’s time to move toward investing. You have more freed-up money because it isn’t going toward paying off your high-interest debt. Whether you have an extra $1,000 or just $100, it’s investable. You don’t have to be rich to invest. 

9. Your goals keep you going.

What are your goals? You know you want to save for college for your kids. You know you want a glorious retirement — whether that’s living next door to your grandkids or lounging in a hammock in Costa Rica. 

You know it takes careful investing to do it. The only way to get there is to plan. So start planning for that mountain home in the Smoky Mountains. So what if you change your mind about where you end up? You’ll be happy you saved for it — whatever “it” is.

Don’t forget to think about your right-now goals and short-term goals. Those are worth considering, too.

Write down your goals. It’ll make it more likely that you’ll achieve them. The other thing you can do is tell everyone you know about them. You want your friends and relatives to keep checking on your goals and push you along. They can be great motivators.   

10. You know you’ve got it in you to learn more about investing.

What seemed complicated 10 years ago might actually seem palatable now. (See, all those articles about best investment firms and best bond funds finally mean something to you!) 

You’ve dug into something deep inside yourself — whether you’ve been nervous, scared, in debt, whatever it was that held you back from investing — and overcome it. You’re ready. You know you can do it! You’ve renewed your courage. You’ve heard an inspirational podcast. You know you can take action. Luckily, that’s our next step.

Take Action!

All along the way, we dropped a couple of hints: 

  1. Invest on your own.
  2. Get a financial advisor on board. 

By now, you may have done plenty of research and know exactly what — or who — you want to invite on your investing journey. Maybe you’ve interviewed friends and family about their financial advisors right in your town. Maybe you’re intrigued by Robinhood or E*Trade or Fidelity or another broker. 

Ultimately, it’s best to get started. Don’t get bogged down by the details. You’ll learn more as you go — and you can always move your money if you’re not happy with customer service or excessive fees or more. 

Just get started. 

Plus, get that slushie, ice cream sundae or a giant swig of champagne — you’ve done something amazing for yourself.

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