A Woman’s Guide to Investing–Part II

and Women’s Institute for Financial Education. There’s another reason to take baby steps: “If you’re buying just a few shares of stocks, you need small wins along the way to build up your confidence,” says Kim Kiyosaki, author of the book Rich Woman (Rich Press; $18.95) and wife of Robert Kiyosaki, author of Rich Dad, Poor Dad (Business Plus; $16.95). “Then you can take the next step.”

Hit the books
Think you don’t know anything about money? Join the club. A recent survey by Prudential Financial found that less than a quarter of women feel very confident about reaching their financial targets. But it doesn’t have to be that way. Barbara Stanny, author of Prince Charming Isn’t Coming (Penguin; $14) and Secrets of Six-Figure Women (Collins Business; $14.95), recommends that women do three things to educate themselves financially: “Every day read something about money, every week have a conversation about money—preferably with someone who knows more than you, and every month save,” she says.

Go for Growth
When it comes to investing, women tend to be more conservative than men, says Stanny. That can prevent women from jumping on a stock tip or taking unnecessary risks, but it can also make them shy away from investments with long-term prospects for growth, such as stocks. You’ll need to take some chances so that your money keeps pace with inflation and provides you with long-term capital.

Protect Yourself
Disability insurance is important at this stage of life. “Single women often do not have anyone else to rely on,” says Cindy Hounsell, president of the Women’s Institute for a Secure Retirement. Emergency savings of three to six months is crucial, she says. In tough economic times, six to nine months might be necessary. Should you get laid off, it may take longer than before to find a new job. And disability could replace a portion of your income if you become disabled and can’t work.

SINGLE WITH CHILDREN

Kirsten Hoyte, author of Black Marks (Akashic Books; $14.95), knows that balancing her future while providing for two small children is not a work of fiction. A 40-year-old English and computer studies teacher at a private high school in Concord, Massachusetts, Hoyte has been investing in her retirement accounts through TIAA-CREF ever since she became eligible for her employer’s match of 8% if she contributed 5%. That was 12 years ago, long before her children, Sterling, 5, and Ridley, 2, were in the picture.

“I did it because that’s what you’re supposed to do to save for retirement,” Hoyte says. “I watched my grandmother live on a very limited income and I didn’t want to be like her.” Balancing retirement savings with caring for two children can be hard, but Hoyte has never wavered from her commitment to invest 5% of her salary. She also recently started contributing $250 a month beyond the match. Hoyte realizes that her investment mix, chosen when she first began the plan in 1996 and unattended since then, might be too conservative.

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