Women Growing as Investors
It must have been strange for Native women to hear about the very first “Women’s History Month” celebrated in March of 1987. In indigenous cultures, women’s history was not separate from the culture. It was the culture. Matriarchy and matrilineal legacies were a huge part of many Native societies before European contact. My how things had changed by 1987.
Today, Native women fight on all fronts for safety, autonomy, and financial security. But new pathways to success are opening up every day.
One field where Native women have big opportunities for growth is investing. Technology has made it easier than ever to gain access to financial markets and information, and more women are taking advantage of this key wealth-building tool.
Research from Fidelity in 2021 found that about 67% of women now invest outside of their retirement plans (up from 44% in 2018). It also found that women are starting to invest at younger ages, which is good, because time is the most crucial element for investment success.
But many women still need to address the limiting beliefs that are holding them back from becoming investors. Some of the big ones are:
I don’t need to invest because I’m a good saver.
Savings are certainly important for meeting short term goals and preparing for emergencies. But savings alone are not enough to build long term wealth. According to Bankrate, 0.23% is the average national interest rate for a savings account today. Meanwhile, the average stock market return is closer to 7%. That’s the kind of return you need to beat inflation and build wealth.
I’m not ready to invest, but I’ll get around to it someday.
Many folks think you need thousands of dollars or a complicated strategy to begin investing, but that’s not true. Really, the most important ingredient for effective investing is time. That’s because investments have a powerful feature called compound interest that enables your money to grow based on both the principal you originally invested and the interest you’ve already earned. The earlier you invest, the longer you have to earn interest on interest and make your money work for you.
I’m not confident in my ability to invest.
The Fidelity research found that a majority of women feel confident when it comes to managing household finances, but less than a third of women are confident in selecting investments and long term planning.
But women tend to make great investors. Studies show that women are less impulsive than men when it comes to managing money — a key trait in an industry where holding assets over the long term leads to success. And numerous studies show that, when they do invest, women's’ returns are consistently higher than those earned by men.
The patriarchal gatekeepers of finance have powerful incentives to make investing feel more complicated than it is; they earn fees managing women's’ affairs for them. But this is a cycle that modern Native women have the power to break.