When I talk to women about investing, I often hear them say “I know I should invest, but…”

Many women intellectually understand that they need to invest because they have been told or they are aware that bank interest rates are low..inflation will erode their hard earned savings etc etc..

Yet when it comes to actually investing, many women hold back. Why is it that so many educated and financially independent women find it difficult to get started on investing?

Women are perfectly capable of becoming savvy investors, once they overcome these 3 mental blocks that hold them back.. 

1) “Investing is too complicated, I’m not good with numbers and finance”

The world of investing can appear intimidating, with all its financial jardons such as P/E ratio, index, valuation, asset classes etc.. As a result some women find it overwhelming and conclude that investing is too complicated and hard to understand.

To add to this, the world of finance and investing often feature men as the financial experts, analysts, gurus etc, giving the social impression that men are better at investing.

No wonder I hear so many women feeling that investing decisions are best left to the men in their life, be it their husband, boyfriend or father!

In reality, women can make savvy investors as well.

In fact studies have shown that women make better investors, returning higher returns then men over the same investing period.

• Women are more cautious in making investment decisions.
• Women possess much more patience and make great long term investors.
• Once women learn the right tools and strategies, they are more likely to follow it rather than trying to catch the next big thing or getting carried away with their ego.

I have personally seen many women who started with zero investing background end up faring better in their investments then men in their same class.

Investing and finance is like any other skill which can be learnt and mastered.

The key is in finding a suitable way to facilitate your learning. You can start with books or websites that can simplify investing concepts for women. Some women also learn well through playing games such as the Cashflow game and attending investing classes or talks.

Women Enrich Network is a platform that I started with my team to share practical tips to empower women financially. We also organise fun & interesting events that covers financial topics in a “lay-women” approach so as to demystify investing for women. And the events are designed for women so you can feel free to ask questions and clear up any questions or doubts you have about investing.

2) I have no time!

This is a common challenge faced by many Singaporean women which is perfectly understandable, given the daily challenges of balancing work and family commitments.

Having to take care of the family after a full day work can be tiring and doesn’t leave much time for herself, let alone time to learn about investing and monitor investments.

Yet, investing is something that we cannot afford to completely ignored.

There is a saying in chinese, “There’s no ugly women, only lazy women”. Investing and taking care of your finances is just like beauty and taking care of your skin. Both requires consistent effort and it pays off in the long run.

The good news is there are ways to simplify the investing experience and even automate the process to work for you in the long run.

For the busy woman with no time to individually research and select stocks, unit trust is one tool which allows them to outsource the selection of stocks to professional fund managers and to leverage on the pool of investors’ funds to invest in a diversified basket of stocks.

The investment can even be automated by setting up a regular investment program which buys into the funds of their choice on a monthly, quarterly or annual basis, without having to time the market. This is a strategy known as dollar cost averaging, which takes the emotions and hassle out of investing. It can be set up as an automatic growth engine working for you in the background over the long run, while you pursue your career and strive towards other life goals.

3) “Investing is too risky, I am a conservative person”

This is a common perception among women and this innate need for security and safety causes women to shy away from investing. To many, Investing = Risking my hard earned money and keeping the money in the bank seems to be the “safest” de-facto approach.

Yet do you know that your money sitting in the bank is also at risk, and it’s in fact a guaranteed risk of losing?

Have you considered if inflation were to be 3%, your $10,000 would have lost 2.9% in a year just by sitting in a bank savings account at 0.1% interest! Risk is unavoidable when it comes to investing but at least we stand a chance to cover, if not exceed inflation.

Moreover you can manage the risk, e.g by spreading your eggs across different baskets a.k.a “diversification”, which balances the risk and volatility of your investment, and by having a proper investment management plan to limit the losses and locking in the profits.

Women’s lack of ego make them more likely to follow these rules and admit mistakes when they are wrong. Just like women are more likely to ask for directions when they are physically lost, women are more likely then men to admit they do not know how to proceed and seek out advice accordingly. The risk adverse attitudes of women in fact make them prudent investors with potential to excel in the investing game!

Anyone, women or men can become great investors with the right attitude and skills.

By investing wisely, prudently and consistently over the long run, financial security and freedom is within reach!

To Your Success and Happiness,

Yong Hui