Financial Confidence Or Luck? How Actions & Traits Help You Pursue Your Goals

Financial Confidence Or Luck? How Actions & Traits Help You Pursue Your Goals

Some people view financial confidence and building wealth as mere luck, but there is more to it than just being lucky. Building wealth doesn’t happen overnight or by chance, and there are no secrets or shortcuts to building wealth.

Wealth isn’t bought or instantaneous unless you ‘get lucky’ and win the lottery; however, the odds of winning may not be in your favor. Building wealth and financial confidence takes time and may happen with these time-tested, comprehensive actions:

  • Planning- financial planning, budgeting
  • Consistency- regular contributions
  • Strategy(ies)- investments such as a 401(k), Roth IRA, Annuity, and other investments suitable for you.
  • Actions- trading, rebalancing, and other actions
  • Monitoring- watching the progress and revising investment strategies or your plan when appropriate.

In addition to the above actions, these four traits may help you work toward financial confidence:

Self-Discipline

Self-discipline is the ability to control one’s thoughts and actions and pursue what one thinks is right, despite temptations. People that practice self-discipline can deter gratification; for example, they consistently save a portion of their income versus spending it all. Their gratification will come when they have saved for a goal, for example, retirement, and can retire with financial confidence versus having to work the rest of their lives.

Focus

Focus is the ability to concentrate on something, regardless of distractions. For example, focus on your goal of building wealth, one step at a time, by consistently investing each month.

Risk Management

Risk management identifies, evaluates, and prioritizes risks that can hinder pursuing of your goals. Evaluating risk is essential to identifying investment strategies that align with your risk tolerance, goals, and financial situation.

Expertise

Expertise is knowledge in areas such as investing, accounting, or taxes. However, expertise doesn’t mean one is an expert but is open to professional advice from others specializing in specific areas—for example, financial professionals, tax professionals, advisors, or business advisors. People with the expertise trait seek education from books, seminars, or others and value learning.

Building wealth and financial confidence can take decades to establish. But with appropriate planning, short-term and long-term goals, strategy, and execution, you’re on your way toward your goal. Good luck!

SWG 2726910-0223d The sources used to prepare this material are believed to be true, accurate and reliable, but are not guaranteed. This information is provided as general information and is not intended to be specific financial or tax guidance. When you access a link you are leaving our website and assume total responsibility for your use of the website you are linking to. We make no representation as to the completeness or accuracy of information provided at this website. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, websites, information and programs made available through this website.

In addition, M3 Wealth specializes in providing strategies and guidance for those who are seeking a better lifestyle in retirement. If you have retirement savings of five million dollars or $50,000, we can ensure it works as hard. As a result, we offer our experience and knowledge to help you design a custom strategy for financial independence. Contact us today to schedule an introductory meeting!

Women & Money: Closing The Gender Investing Gap

In the U.S., men are investing and accumulating wealth at a greater pace than women, fueling the gender investing gap. It is important that women accumulate enough retirement savings since women have a life expectancy of 80.2 years compared to men having a life expectancy of 74.5 years, according to WorldData.info. Below are five Issues and five ways to work toward closing the gender investing gap.

 

Women must be active investors to accumulate more retirement savings to last their long lives.

If women invested at the same rate as men, there would be an extra $3.22 trillion of assets under management today, and $1.87 trillion additional capital into responsible investments, according to a BNY Mellon Study. There are numerous reasons for the gender investing gap that, as a society, we must work toward bridging. Here are five problems women may face when it comes to investing and how to fix them:

1. Women’s Investable Income Expectations Are Off

Many women think they need a few thousand dollars in disposable income each month before they invest. The same study found that many women believe the IRS limit for IRAs is the amount they must invest, which isn’t accurate. Also, women who describe their financial health as poor are less likely to invest.

The fix- Financial professionals can help bridge this gap by encouraging women to start investing- regardless of income and at any amount. Fund companies can market that investing consistently; even a small amount can add up over time thanks to the power of accumulation. Financial education at work and in schools are great avenues to illustrate that no income is required to start investing.

2. Investment Strategies Aren’t Always Designed For Women

Women are motivated by an investment’s impact, for example, socially responsible investments, but often have difficulty finding investment strategies that align with their values. Or, some investments they choose may not produce the consistent positive returns that help women accumulate wealth.

The fix- The financial industry must develop funds and investment strategies that align with women’s values that impact people and the planet. These strategies may produce returns that enable women to be financially confident and provide for those they love and the causes they care about. Also, fund companies must market to women by depicting confident women making an impact on our world and its people through their investing.

3. A Gender Pay Gap

In 2022, for every $1 that men make, women earned 0.82 centsThe U.S. Census Bureau has found that even though Equal Pay Day has brought awareness to the gender pay gap, women would need to work three additional months to catch up to men’s pay. With less money to invest, women may invest less or not participate in the markets due to having fewer investable assets.

The fix- Companies can help close the pay gap by allowing women to participate in leadership and assess their pay and employee benefits programs to be inclusive to all. Hiring third-party consultants to review employee pay, develop programs to reduce hiring biases and pay discrepancies, and implement new policies can help bridge the pay gap.

Developing employee leave programs that benefit women and all caregivers with leave pay when they are absent from work to care for family members. Program benefits, including short-term insurance and a ‘pay bank,’ where employees donate their unused leave to benefit others, can help provide paid leave, and flexible work schedules can become policies.

4. Female Investor Confidence Lags

Many women feel they don’t understand investing. They also feel more comfortable saving in savings accounts or investing in property and less comfortable investing in market-driven investments, according to the BNY Mellon Study. There are also biases in marketing investments to men versus women, which can deteriorate their investing confidence.

The fix- Creating company financial education initiatives and marketing wealth-building programs to women is an excellent start. Encouraging financial professionals to specialize in working with women and encouraging more women to join the financial services industry can help. Awareness in marketing to include women in advertisements, financial education in schools and better communication that women must invest in their futures can help female investor confidence.

5. Women Tend To Avoid The Risk

Women feel less confident about investing in the stock market, alternative investments, and REITs. They often view investing outside their employer’s retirement plan as risky. When it comes to risk tolerance, women also have a lower tolerance to market risk than men:

  • 9% of women report a high level of risk tolerance.
  • 49% have moderate risk tolerance.
  • 42% have a low-risk tolerance.

Source– The Pathway to Inclusive Investment, BNY Mellon

The fix- While risk, performance, and results are part of investor reporting, it isn’t appealing to women. Instead, education and marketing directed toward women about risk, performance, and results must include the reason for investing.

While risk, performance, and results are part of investor reporting, it isn’t appealing to women. Rather, education and marketing directed toward women about risk, performance, and results must include the reason for investing. Many women invest in a cause to make the world a better place, which requires taking some risks.

One thing that may help fix the gender investing gap is for women to invest in their future by consistently saving and investing. Working with a financial professional can help women develop a financial plan and design a portfolio of strategies that align with their values and produce positive returns.

SWG 2726910-0223c The sources used to prepare this material are believed to be true, accurate and reliable, but are not guaranteed. This information is provided as general information and is not intended to be specific financial or tax guidance. When you access a link you are leaving our website and assume total responsibility for your use of the website you are linking to. We make no representation as to the completeness or accuracy of information provided at this website. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, websites, information and programs made available through this website.

In addition, M3 Wealth specializes in providing strategies and guidance for those who are seeking a better lifestyle in retirement. If you have retirement savings of five million dollars or $50,000, we can ensure it works as hard. As a result, we offer our experience and knowledge to help you design a custom strategy for financial independence. Contact us today to schedule an introductory meeting!

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