MoneyLife

Easy Ways for Women to Start Investing

By Anna Yen
Women to start Investing

Despite living longer and historically earning less than men, women are more conservative in investing. According to S&P Global, only 26% of American women have money in the stock market. Failing to invest enough can hinder financial freedom, delay retirement, and make it harder to reach your goals.

However, there is some good news — when female investors do invest, they’re more likely to see better returns thanks to their patience and level-headed approach! Go, ladies!

Need more inspiration? Watch this episode of the “Black Money Series,” from our partner dfree. Nia and Chloe discuss some tips on how YOU can work your mind, money, and MAGIC! 

How To Make Investing Easier

Investing can seem intimidating, with the endless options and unfamiliar jargon. But there’s an easier way. Automated investing services personalize your investments according to risk tolerance and help you put money to work effortlessly.

With fully managed investing, experts take care of everything — from creating your portfolio to picking individual investments to managing your account. MoneyLion levels the playing field with a low-cost fully managed investment account. There are no asset-based management fees and no minimums. Invest however much you want, when you want.

With a little help, you’ll find investing as easy as any other habit. MoneyLion helps you start immediately, get your feet wet, and watch your money grow. With the complicated parts of investing taken care of for you, you can simply open your MoneyLion app on the way to work to invest a few dollars or check on your portfolio.

How To Get Started

Simply log in to your MoneyLion app and sign up for an investment account

Nearly half of MoneyLion members are women, and almost all of them are first-time investors. Our female members enjoy avoiding expensive financial advisor fees, complicated investing platforms, and high-pressure broker sales tactics by taking advantage of a MoneyLion Investment account. 

A MoneyLion investment account gives you full access to a managed and automated investing system. Simply answer a few questions in the app that help determine your risk tolerance, and you’ll receive a personalized investment portfolio custom-fitted to your needs. You can also adjust your risk level, withdraw or deposit, and set up auto deposits as often as you’d like. 

It takes a couple of minutes for us to set up your portfolio, and once you’re done, you’re an investor!

How Much Should You Invest?

How much should you invest? The answer depends on your financial situation. Investing as much as you can is generally beneficial, especially if you’re younger and have time on your side. Take a look at your personal finances and decide how much you’re comfortable investing each month, whether it’s $2, $20 or $200. 

When you consistently add to your investment account without withdrawing, you’ll start to see the benefits of compound interest. Compound interest is the money you will make on your initial investment and the gains on your investment. Check out this compound interest calculator to get a better understanding of how profits make profits!

Remember, women tend to live longer than men, so we’ll need a large nest egg to depend on later in life. Get started today, girls!

What Should You Invest In?

MoneyLion has you covered with well-diversified stock and bond ETFs representing companies of all sizes and regions around the globe. 

Investing in a mix of stocks and bonds gives you diversified exposure to financial markets. If you want to invest yourself, you can either construct a portfolio out of individual investments or opt for ETFs that bundle a variety of individual investments together. With MoneyLion, we take care of these decisions for you, and you can view and modify your mix (aka your portfolio) in the app at any time. 

Here’s a look at the three main investment types:

Stocks

A share of stock is a single piece of ownership in a corporation. When you buy a share, you buy a tiny piece of a company. MoneyLion investors can invest in fractional shares, which are an even smaller piece of a share, so you can invest in companies you love no matter the stock price!

Many corporations pay stockholders a small amount of money annually or quarterly called a “dividend.” You receive dividends based on the number of stocks you own. For example, if a company pays out a $0.10 dividend per share and you own 100 shares of stock, you’ll get $10 from the company each time it pays out dividends. Corporations aren’t required to pay out dividends, and stock values can change quickly. 

Bonds

A bond is a legal contract between a buyer and an entity that borrows money. The U.S. government is one of the largest bond issuers, but corporations can also issue bonds. Bonds are typically safer than stocks because the issuer is obligated to pay you back for the money it borrows. Note: Bonds usually have a much lower average rate of return than stocks.

Exchange-traded funds (ETFs)

An ETF is a pooled investment vehicle that “bundles” a number of stocks or bonds together. You buy a small percentage of every stock or bond in the fund when you buy an ETF. ETFs are an easy way to diversify — which means you spread your assets around to reduce volatility as you seek gains. 

How many stocks, bonds, and/or ETFs should you buy — and which types? That depends on how comfortable you are with risk and how long you plan to invest before withdrawing. If you want to take on risk to pursue higher gains and invest for a couple of years, you’ll likely opt for mainly stocks. On the other hand, you’ll likely choose bonds if you’re not as comfortable with risk and need to be more cautious about preserving your money in the short term. 

How Long Should You Keep Your Investment Account?

The amount of time you’ll need to keep your investment account open depends on the type of account you have and the goals you’re trying to reach. For example, if you have a Roth or a traditional individual retirement account (IRA), you cannot withdraw your funds before you reach retirement age without penalty. 

Most other types of brokerage accounts, such as a MoneyLion Investment account, you can keep growing for as long as you want and withdraw anytime! Just remember, investing typically rewards patient, long-term investors the most, and you shouldn’t withdraw unless it’s absolutely unavailable.

How Can You Maximize Investments?

Whenever you get a paycheck, which you can get up to 2 days early with RoarMoney, you can transfer cash over to your investments. Better yet, set up Auto-Invest to automatically transfer for you.

Participate in employer-sponsored retirement plans like 401(k)s, where employers usually match a percentage of your contributions. Don’t forget to maximize the money deposited into your own IRA every year to add to your long term savings and investments.

Can You Borrow Against Your Investments?

Your bank might allow you to take out a line of credit against the money in your investment portfolio. When you agree to borrow against your assets, your bank gets a lien on your assets that they can use to claim your investments if you don’t pay back what you owe, so read the fine print!

You can also withdraw money from your retirement accounts, but you will pay a 10% early withdrawal penalty in most cases. You might be better off letting your investments grow and using solutions like a Credit Builder Plus membership instead, which provides access to a loan of up to $1000. MoneyLion offers loyal members the ability to borrow up to three times the value of the portfolio. And you don’t need to be a high roller to get access. 

Close the Investing Gap

Are you ready to get started on the path to a healthier financial future? You deserve it! Get started or learn more about beginner investing strategies by visiting our financial learning center.

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