Many women, research shows, would like to learn more about finance and investing, but many do not feel senang within the world of finance. Sin! Because women in particular are good investors, perhaps in the long run better than men. On average, we achieve long-term greater returns. Why? We are less guided by ego and take less risk. This means less chance of making big hits quickly, but also less chance of losing a lot of money. Totally top notch, then, for long-term investment success. Before you storm that stock market: 4x this you need to fix before you invest. Read along.
The basics
A first note: Don’t invest with money you can’t afford to lose. Investing has risks and you need to understand them well. Read more about the risks involved in investing here, but…. don’t be scared off, either. In fact, saving also comes with risk: inflation decreases the value of your savings. Either way, make sure you have a buffer and delve into investing before you start.
1. A solid foundation
Make sure you have a solid financial foundation before investing:
- A piggy bank with which you can last for several months should something unexpected happen. We tip: make sure you have 3 to 6 months of expenses saved up. Pretty smart. Read how to save this easily here.
- First give a prio to paying off debts: credit cards and student debt. High-interest debt. If you no longer have those: ha, burden off your shoulders.
- Overview of your finances: what is coming in and what is spending most of your money on. Insight is key. Insight gives overview, gives peace, gives handles. Take Elfin’ s free budget course and get a handy cashbook you can start using right away.
2. Make a plan
Next, once you have your basics in order, it’s a matter of making a financial plan for yourself. You want to invest, but maybe your goal is also to take a long trip in a year. In that case, you are better off saving, because investing is something you really do for the long term. Anyway, make a short-, medium- and long-term financial plan.
This goes beyond just an investment plan. This is basically a plan in which you think broadly about what you want in life. Thus, you can also ensure a well-connected financial plan. What you want in life is personal. So no one can fill this in for you.
Make your plan concrete and visual. Write it down. If in 5 years your goal is X, what should you do to achieve it?
Next, make sure you have a well thought out investment plan. Investing without a plan is like taking blood samples and doing research without knowing what you actually want to research. In other words, that’s going to be a blamage. Read a detailed article on how to create an investment plan here.
3. Knowledge is power!
Teach yourself some knowledge. Because knowledge = power. Power over your own finances and (financial) future in this case. Take the Beginning to Invest course with Elfin, to name a few. Thousands of women went before you.
Make sure you not only know about investing, but also about yourself. How emotional are you when it comes to making decisions? The more you bring your ego with you (and hey, we all do, because we are all only human) the more dangerous and risky your investments can be.
Do you know about yourself that fluctuating stock prices make you restless? Then – in the case of long-term investing – don’t check your broker app every day. Do you sleep more comfortably when you know that your money is available to you at any time? Then don’t invest in real estate.
4. Provide daily inspiration and information
Join Elfin and surround yourself with the community: people who already have what you love and can bring you into their energy. Sounds weird? Isn’t. You know the quote, “show me your 5 best friends and I will show you what your life will look like”? Surround yourself with positive people who help, inspire and encourage you. Especially in terms of money oh-so-important.
In conclusion
Investing is not a way to get rich quick, but a way to boost personal wealth. You’ve probably heard tough talk at parties, or on social media, of people who invested with high risks and got very high returns on them, and thus indeed made a lot of money in a short period of time. But remember: there are many more people who have lost a lot of money doing that, but you don’t hear about them.
Rather, go for the slow & steady approach. Long-term investments. This means taking relatively little risk, and in return a relatively low return. That’s okay, because building wealth is a long-term process. Time, risk, spread, return. All in connection with each other.
