Three Golden Rules For Successful Investment
Research and studies continue to show that women are better at saving. What started off as Granny’s money stocking, today rests on savings accounts and money market accounts. There’s just one problem to that: With an inflation rate of an average 1.9 percent (in 2018) and interest rates of nearly zero percent you’re rather ill-advised with such solutions as far as the accumulation of capital is concerned.
If you stockpile cash money granny-style at home or think that a savings account still serves as a reliable nest egg for rainy days, you’re pouring the growth potential that hides in there down the drain.
On the bright side, though, you can change that. Because the afore-mentioned research also says: women are better investors. They are more prudent, patient and risk-aware. Three characteristics that make for a great prerequisite in terms of successful investment. And we’re not only talking about increasing pension income or saving up for our children. Women are long obliged to take their financial future into their own hands!
It is long due that we rethink and commit to our own financial matters. For women who aren’t confident or financially literate enough to start a successful investment on their own, FinMarie offers a free, individual assessment. You can book it right away by clicking on the button below:
However, of course we still want to equip you with our three most important rules for a successful investment. Just read on.
Invest Your Money And Diversify It As Broadly As Possible
Rather than letting your savings stagnate on your savings accounts, multiply it! In order to do that, you need to invest (part of) your money. The success of an investment is highly dependent on the breadth of your portfolio. That means, you preferably invest your money globally and in as many diverse strategies as possible. These can contain stocks, bonds, funds or ETFs (exchange traded funds). It is especially important that you follow through with your investment strategy:
- Do not ever let media and fluctuations get to you.
- Do not act erratic and sell early.
- Above all: Never let emotional investment strategies seduce you.
It is completely normal and healthy(!) that the capital market from time to time is subject to fluctuations. Endurance mostly pays off in the form of higher yields. Let your money work for you a little, be patient, and trust your economic decisions. Emotions are an utmost taboo when it comes to money!
Where Should You Invest To Be Successful?
A broadly diversified portfolio is one thing. But which markets are most efficient for a successful investment? We recommend you focus on seminal industries. Global technology and health in emerging countries, for instance, are still among fund experts’ most popular sectors. A well-managed fund lets you benefit from the stock markets’ chances while keeping the risk assessable.
It’s essential to do proper research on the respective companies and industries. Read enterprises’ annual reports, study their market potential, and sound their future perspectives out.
If you decide to join FinMarie’s client base, our financial experts take this boring, time-consuming task off your shoulder and create an investment portfolio that suits your wishes, visions, and possibilities. Why not book a free first assessment with us right away?
Successful Investment vs. Relying On Pension
As unpleasant as it is, we need to face reality. Pensions are no longer a reliable financial security. Currently, the pension level knows but one direction — downwards. For women, the situation is all the more dramatic. Due to family planning, parenting times, and often part-time jobs, our retirement income decreases considerably. German monthly magazine Spiegel published alarming numbers on their website: women’s inconsistent career lives lower their pensions by 53 percent compared to men’s.
This means, women need to think about who they can manage to keep their living standards beyond their active work life as early as possible. Government-funded retirement benefit plans in part do offer a good possibility to narrow the pension gap (at least temporarily). There’s still room for improvement, however!
It’s better to keep your nest egg a bit more comfy by successfully investing on your own terms. Regardless of and independent from the state and your main bank. A 25 year-old woman today that puts aside about 100 Euros each month and broadly diversifies her portfolio all across the stock market, can gain around 111.320 Euros at the age of 55 years — provided that yields remain rather stable. That’s one seminal investment right there. And it pays off in the sere and yellow.
A Successful Investment Is Possible With Small Rates
A successful investment can pay off from savings rates of 50 Euros per months already. So not only did Nana give us her money stockings to take along, she also provided another wise advice in terms of money: a penny saved is a penny earned. So our third smart rule for a successful investment can be summed up as “a little comes a long way”.
Rather than the actual monthly amount you invest into, for instance, an ETF accumulation plan, it’s the continuity that leads to a successful asset building. With such a savings plan you can invest in any index of your choice and participate in its performance at any point in the market phase.
Many banks offer a wide range of more than 900 ETFs that can be used for one singular ETF savings plan. With saving it’s important that women adjust their savings rates to the development of their income and their age. In order to start off a successful investment, 50 Euros per month fully suffice. After a couple of months or some few years, however, you should rise that amount according to your possibilities to at least 100 monthly Euros.
Do you want to know more about your chances of setting up a successful investment? Then book a noncommittal and free-of-charge assessment talk with our FinMarie investment experts: