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Lorna Kapusta is head of women investors and customer engagement at Fidelity Investments.

As a new generation of women takes a seat at the investing table, there are many reasons for optimism around their financial future. Broader adoption of 401(k) plans, the greater ease of investing through online, low to no-fees, and expanded access to financial education have helped more young women get an early start on achieving their financial goals. In my own experience working with women customers, many have learned from family and friends how important it is to begin saving and investing early and are laying a strong financial foundation along the way.

Fidelity’s Money Moves Study, released in March, revealed three key habits that women investors ages 18 to 35 are embracing.

Start early.

On average, women aged 18 to 35 are starting their lives as investors much earlier in life. The youngest generation of women, on average, opens a retirement account at age 20 and a brokerage account at age 21, the survey found. Women ages 36 and up opened a retirement account at age 27 and a brokerage account at age 30, on average.

The pandemic seems to have played a role in jump-starting young women’s adventures as investors. Among the younger women, 50% reported they’d started investing in the last six months, and 58% said the pandemic was influencing the way they think about money and make financial decisions.


The flip side of this is that 36% of women ages 36-plus said their biggest financial mistake was waiting too long to save for retirement. As many have become aware, the sooner you start to invest, the earlier you benefit from compounding. If you start investing $50 a month at age 25 you can potentially reap $143,000 at retirement; and get started at age 50 and you’ll accumulate $46,000.

It’s okay to start small.

Among younger women investors, 35% started investing with a small amount of money to build their comfort level and confidence, and 37% believe that no matter what amount you have to invest, just getting started is the most important thing. Another survey from FinanceBuzz corroborates that women may be more likely to believe that you don’t need as much to begin investing. When I first started investing, I was a bit intimidated because I thought I needed a lot of money to get started, but I learned steady and consistent contributions can go a long way.

Put your money where your heart is.

Asked what aspect of their finances makes them proudest, 43% of women in the 18-to-35-year-old range pointed to saving for events that have a personal meaning and purpose, achieving key goals for themselves and their families like buying a home, and using money to make a difference or leave a legacy for their children. With many investors seeking a more purpose-driven financial life, young women investors’ commitment to finding alignment between their goals and how they invest offers great ideas on how to do this for any investor. One place I’m always proud to contribute is to my three children’s 529 college savings accounts.

What’s ahead for women and could hold them back?

That said, young women aren’t immune to challenges as investors. In fact, 26% of survey respondents said they haven’t invested more because they can’t afford it.

Some are dealing with fluctuations in their career, which hampers their ability to invest. Aside from that, many young women face financial responsibilities that impact investing. Perhaps it is not surprising that 36% said not being able to handle emergencies keeps them up at night. It is also not surprising that in a different survey, 72% of women respondents cited financial security as the main motivator for investing.

The good news is many of these women are reaching out for the help they need to navigate the environment in which they are investing. We’re encouraged by the progress we’re seeing and hearing—that increasingly, women have more confidence when it comes to their money. In fact, just 23% said they feel overwhelmed by their finances.

Getting started with investing can empower women and ensure they are making their money work for them at any age. I am excited for the future, as there are more women investors, we all can pass down investing advice and know-how to future generations of women for decades to come.

The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.

Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?

Source: Forbes

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