Women can be a powerful force in the financial world and the time to get started is now

Women constitute half of the world’s population. It would seem rather natural and obvious then that woman should play an important role and contribute significantly to economic development of any country. But long-standing inequalities and traditions have prevented women from fully participating in and, most Importantly, benefiting from economic performance and financial markets in particular. In fact, when it comes to finances, few studies have given women centre stage.

Luckily, there is light at the end of the tunnel. We’ve namely seen a positive shift since the outbreak of the COVID-19 pandemic, which seems to have forced traditional investment houses to take notice of this long-ignored segment of the population.

With a third of the world’s wealth under their control, women are an Immense economic force. Women are growing their wealth faster than before and are outpacing the growth rate of the wealth market overall. Did you know, for example, that according to a 2020 study by BCG, women are responsible for adding $5tn globally to the wealth pool every year? Or did you know that women today control over 32 per cent of the global wealth and are responsible for a staggering 85 per cent of consumer purchases?

Looking at these numbers, the question arises why women are lagging behind when it comes to investing and trading in the stock markets? And how can we increase participation at the individual level to increase financial freedom?

Getting started on investment

Traditionally, women have taken the role of bookkeepers in their household, while men made the investment decisions. However, as women take control of their own investment decisions, they need to understand how to mitigate risk and balance finances for both short- and long-term gain.

When balancing your finances between the short- and the long-term, the best recipe is learning about how starting small generally leads to long-term success. Rather than large single lump sums, investing smaller amounts monthly helps to spread the risk.

By buying small amounts every month, you end up buying the average price for that particular stock in that year, reducing your risk. Year on year, the average price of that stock goes up, and so does your investment. This is especially a great time to be investing the regional market as it firmly establishes its prowess in the global marketplace.

There is also an opportunity to be tagged to the region’s success. Investment in local and regional markets such as the Dubai Financial Market (DFM), Abu Dhabi Securities Exchange (ADX) or Saudi Stock Exchange (Tadawul) might also be an interesting option for investors.

Here are a few tips on how to start building your financial future.

1. How much

It doesn’t take as much as you think to start investing. Even a small but fixed monthly amount is enough to get you started. This amount should depend on your income and how much you have left each month after you’ve paid your bills and set aside for your emergency cash (If you don’t already have a sufficient amount in emergency cash saved).

2. Diversify

As the old saying goes, don’t put all your eggs in one basket. In this case, don’t put all your money in one stock or one type of asset. Instead, you could consider Investing in ETFs (funds that hold multiple stocks) or a range of companies that you know and trust. You can also look at real estate, or commodities like gold – whatever fits your investment strategy. Just make sure you don’t put all your money into one “basket”.

3. Tools

It’s important to choose a trading platform that ensures investing is easy, cost effective, while also helping to continually educate you. It’s important that the platform helps remove friction and complications, so you’re Investing and trading experience seamless and transparent. It’s also Important that the platform is clear on how they price products and what costs are involved. Remember, trading and investing don’t need to be expensive and there hasn’t been a better time from a cost perspective to invest and/or trade in the markets.

4. What to choose

A basic tracker fund is an easy way to start. What they do is follow the performance of a particular stock market, using an index exchange traded fund, providing you with the information you need on companies you have heard and know of. This might help you understand the fee structure, so even if you can invest only a small amount, it won’t disappear before reaching the stock market. But remember that as a rule of thumb, the sooner you will need the money, the less risk you should take. Always make sure you understand the products that you are trading and investing in before you start.

Finally, remain calm and steadfast. Stay patient rather than impulsive and reap the long-term gains of the market.

So why wait? Start now.

Financial literacy and awareness can not only help secure our financial futures but also of our future generation. For, empowerment is an all-round thing, and a financial empowerment is key to finding a seat at the table, both metaphorically and literally.

Joy Dabeet is the CMO at amana

Read: Why gender equity in tech matters more than ever