You’ve heard the phrases “you can’t win if you don’t play” and “the rich get richer”. They are true. Those with money are playing the game of investing and are using what they have to increase wealth through exposure to the market. Successful investors understand there’s a catch: when you invest, you could lose. But, they’ve been learning to love investing and the results are paying off.
Investing is a scary thought for most women (or all of us). But, the point that’s so often missed is that you only lose if you sell. Otherwise, it’s just a downturn on paper. You can wait to sell. But, how can women get more comfortable learning to love investing?
One way is to look at investing as a game and learn the rules to play. If you’re going to have the retirement you want, you’ll need to get in the game.
Learning to love investing starts with a playbook
Like all games, there are rules and playbooks. Investment rules don’t necessarily appear that interesting at first. We’re talking about books from successful investors and articles in The Wall St. Journal. There are websites chock full of stock quotes and mutual fund pricing, charts, graphs. Plus, we’ve got a whole new language to learn.
Frankly, it’s not that fun at the beginning. Remember trying to learn to play the flute in 4th grade? Or the piano when you were seven? How about the first time you got on a soccer field? The start of anything new is hard. And not so fun. It’s here at the start of the game that many women simply give up. They don’t think they have “a head for investing”. Well, don’t believe that for a second!
Do you love football?
There are lots of games we don’t really know much about. So many have complicated rules and we don’t really understand them. But we’ve become avid fans anyway. We’ve managed to learn the rules along the way. We argue with (or against) the refs and the umps. It’s surprising how bad we feel when our team loses.
Are you a baseball fan? When was the last time you hit a 98 mile-an-hour pitch? Do you love football? Yet, have you ever caught a 50-yard pass or tackled a 225 pound running back? Just because we may or may not have played the game doesn’t mean we haven’t learned the rules. It doesn’t mean we don’t get it.
Apply this idea to learning to love investing
Same goes for investing. You might not have played before, but you can learn the rules. If you are not that good at investing, you can practice and improve like the pros. Even better, you won’t get tackled or tagged at the plate!
Let’s make it easier to get started. Take the money that you’ve already socked away in an IRA or 401(k) or 403(b) and look at what it’s invested in. We usually call the “stuff we own” in an account the underlying investments. You probably have a choice of mutual funds or target-date retirement funds as options to put your money. It’s also possible to have ETFs — exchange-traded funds. Then, there are index funds and individual securities. The key to this first step in your retirement account is to make sure you’re directing your money into an appropriate underlying investment.
Next is look at whether your money is making money. Do you have a well-diversified investment strategy? Are you using the resources available at the place where you’re saving to get your retirement money on track? The investment firm probably gives you access to an adviser who could help. The rules of the game are there for you to use and capitalize on for your retirement security.
A fun insight from the NFL
A recent Washington Post story revealed that women make up an estimated 45% of the National Football League fan base. That’s about 67 million of us. We’ve been tagged as the NFL’s most valuable players! Why? Because we buy so much football stuff. The sponsors who run ads during the games recognize women’s influence on buying decisions. We might not play football, but we are in the game.
We love to watch our kids play at any game, sport or activity they choose. No one cheers them on louder. Every mom learned the rules of their games. Right now, we need to do the same thing. Women need to set aside specific time for learning to love investing. It’s never been more important to participate in investing. Go girls, go!
Some rules of the investing game can be found in these excellent playbooks:
- Magazines such as Money or Kiplinger’s Personal Finance
- Online sites including Motley Fool, Investopedia, and the American Association of Individual Investors (AAII)
- Mutual fund or investment companies’ websites are chocked full of information. Check out investment firms such as Fidelity, Vanguard, or T Rowe price (among others)
- Newspapers like the Wall Street Journal or Barrons
- Retirement-specific Newsletters including Market Watch’s Retirement Weekly and Kiplinger’s Retirement Report
- Your employer may also offer resources and helpful educational material
Don’t just sit on the sidelines—participate & play to win! Also, make some really great snacks for football game day!