Let It Grow, Let It Grow
That is the key message from Marah Curtin in this podcast. There is no point keeping your hard earned money in cash when it could be working for you. It might feel comforting sitting in your bank account or worse under the mattress but you have to think of your finances over the longer term and get planning. International research backs this up Marah Curtin tells us citing that overall “women invest 40% less money than men do. According to one survey, not only have few of us started saving for retirement, we’ve saved less and on average 68% of our money is in cash, which is roughly 20% more cash than men tend to hold. In other words, the biggest investing mistake that women make isn’t over trading or overconfidence or panicking during downturns, or any of the other behavioral mistakes that tend to trip up investors, our main issue is simply not investing at all.
So not only is that money missing out on potential return from market gains, but it’s effectively shrinking in value over time as a result of inflation.” People can feel paralysed she believes. “Our research here in Ireland tells us that women are in fact, about 30%, more risk averse than men. Ironically, cash tends to make women feel more secure and investing inherently risky. But what’s important for women to realize is that they can’t afford not to invest. And that not investing for the future is actually riskier than sitting on cash and doing nothing with it.”
Starting a femolution
I’ve been following Marah Curtin on social media through her @Femolutionist and @Cents for Kids channels for a long time so I was delighted when she agreed to the podcast with me. Marah works with one of the leading Irish Stock Brokers Davy’s and is Director of Client Engagement there. Before coming to work and live in Ireland she worked in the financial planning field in New York for 11 years with business owners and senior executives.
Marah has always been passionate about getting women to grow their financial resources and believes that financial literacy could be taught from an early age. Traditionally Financial Services industries tended to use language that was confusing to say the least especially when it came to serving women’s needs.
“As we all know, the financial services industry has a bit of a job to do with regard to being more inclusive of women. A Femolution like any great revolution begins with the women working in the business as well as the women we serve”, Marah believes. “The mission is very personal to me and absolutely extends to my day job and that is to tackle that final taboo and get women talking about money and more specifically about investing.” She believes that the the industry needs to do a better job for women. “As I like to say, competence yields confidence. So the more educated women become, the more confident they become in their ability to manage their money and make important financial investment decisions for themselves and their families.”
“Not only will a woman more than likely outlive her husband, and be solely responsible for managing her investments one day, but there are also very real benefits to both men and women, when a woman is fully engaged in the financial planning and investing decisions.”
Changing The Model
“This business was built for men by men. Common practice is based on what works for the male advisor and what attracts the male client, from the way we engage clients to the way we advise them” Marah says. Because of the traditional masculinity pervading the financial services industry women have not always been seen or their priorities respected and reflected in financial products. Marah believes that this needs to change and for really practical reasons. “Not only will a woman more than likely outlive her husband, and be solely responsible for managing her investments one day, but there are also very real benefits to both men and women, when a woman is fully engaged in the financial planning and investing decisions.”
A Gender Balanced Approach to Investing
From research, Marah says both men and women can benefit from a gender balanced approach when it comes to investing.
“Regardless of gender, we all generally want the same things, to provide for our family and have enough opportunity to enjoy both our personal and professional lives. With that said, while men and women may wish to arrive at the same destination, they often choose quite different paths. And what’s interesting is that just as gender balance in any context leads to better decision making a gender balanced approach to managing money benefits, both men and women.
What research tells us about this is that when a woman is present and participating, be that the financial advisor, or the spouse, and especially when it’s both, men tend to dial down their risk appetite to match their psychological reality. That may be because they feel more comfortable doing so with a female advisor, you know, less testosterone in the room, or because their partners being present helped to remind them of what their money is ultimately for.
Where To Start
You don’t need a million to start but maybe a thousand could be a good start off point. “One piece of advice I actually recommend is talking to a friend, find out who they’re working with, find somebody that’s happy with their financial advisor, maybe start with your parents. The CCPC has some good guidance on how to get started investing and what to be mindful of, and there’s also a link there that takes you to a website with the Central Bank that you can actually check whether the firm that the individual that you’re working with, is actually registered and
legitimate. https://www.ccpc.ie/ Competition and Consumer Protection Commission
Pay off credit card debt as soon as you can she recommends as this is a very expense form of financing. Marah Curtin also recommends the 50 20 30 guideline. “These represent the percentages of your take home income that should go into three things, your essentials, your future, and your lifestyle. So 50% of your income should go to the essential things like your rent or mortgage, transportation to and from work groceries and utilities. 20% of your income should go towards your future, like paying off debt, building an emergency fund or saving for retirement, and a whopping 30% is yours to play with. You can do whatever you want with it. Of course, you know, this is a guiding principle that works for most budgets. But we know that money isn’t one size fits all. So it’s important to recognize that for your personal budget you may need some wiggle room at times. So for example, if you’re playing catch up with your retirement savings, your 20 may expand or if you’re stuck in a lease or for an expensive car or home or your 50 may not be there yet. The goal here is for you to understand what goes into each of these budget categories, and to get a sense of what a balanced budget should look like.
Your Future Self Will Thank You
To those who keep putting off financial planning Marah Curtin suggests thinking of this as a gift to your future self. “We procrastinate because it’s overwhelming, and it feels complex, and it’s never more complex than we think it is. But I say your future self will thank you for it kind of looking back. It’s a little bit of time that you set aside to potentially have a huge impact on your financial future.
Marah Curtin is on Linked In Marah Curtin CFP
on Instagram twitter and as @femolutionist and @centsforkids
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