COLUMN: Ask the Money Lady – Women investing in today’s market

Dear Money Lady: I am a single mom and wondering how to get started investing. The market right now is really scary with all the U.S. tariffs and the stock market going down. Should I stick with my high interest bank account until things get better? Jan

No Jan, now is the time to invest in the market – everything is “on-sale,” and you could earn a lot more from your investments when the market turns, than keeping your money in a bank account.

More women like Jan, need to be looking at investing for the future but unfortunately the stats on women investing today are quite dismal. Because we are still experiencing a gender wage gap, it makes it all the more necessary for women to invest today. Here’s some facts: women on average earn 20 percent less than men. When broken down by demographic compared to a white man, Asian women earn 13 percent less, white women earn 18 percent less, black women earn 35 percent less and all other women (visible minorities) earn 42 percent less. Over an average women’s working career, it’s estimated she will earn $450,000 less than the average white man will earn over his lifetime. This reality makes it imperative, especially for single women, to invest sooner so they can use the benefit of time to grow their investments, (through dividends and compounding). Women tend to be much more conservative with their investment decisions than men and typically feel intimidated by a financial advisory community of mostly men.

Ladies, start believing you can be smart with money; learn more. You just need to ensure you invest enough of your money to provide for the future you want.

Often times people pursue complicated investment strategies, believing the complexity will give them a better return. Some advisors will take it a step further, talking about the amount of time they must spend evaluating different companies for things like pricing, dividends and growth potential, to convince clients that their investment strategy is the best. Personally, after 35 years in the industry, I have found that there is no need for complexity – simple is still the best.

Ladies, here is how you should get started. I want you to choose three or four ETF Index Funds (exchange traded funds). Index funds are a great way to get into the market because they’re professionally managed funds that follow a benchmark index. They provide superior diversification, lower risk and lower costs. You want to choose different asset types: 1. US Stock, 2. Canadian Bonds, 3. International Stock. Stay away from emerging markets for now and stick to funds that follow the NASDAQ and the S&P. Here are some funds you could check out.

• Fidelity ZERO Large Cap Index

• Vanguard S&P 500 ETF

• BMO S&P 500 Index ETF

• Vanguard Total Stock Market ETF

• TD Active Global Dividend ETF

• Vanguard Conservative ETF

• TD Active US Dividend ETF

• Vanguard Global Momentum ETF

Saving money in a high interest savings account is good for emergencies or short term commitments, but to keep up with inflation, you will need to invest and get your money working for you. Women live longer than men and will most likely need more money to support their retirement. Don’t wait ladies – get started now.

Christine Ibbotson is a Canadian author, finance writer and syndicated money coach on BNN Bloomberg. She is also part of the everyday lineup on CTV Your Morning in every province. If you have a money question you want answered free – send it to: info@askthemoneylady.ca.