Search

The Fierce Girl's Guide to Finance

Get your shit together with money

Month

November 2019

Why investing is just like wearing false eyelashes: the pep talk you’ve been waiting for

A long time ago I bought a variety box from Sephora that came with a set of Huda Beauty false eyelashes.  I often looked wistfully at this wonderful creation.

If only I were that kind of woman. You know, the type who can skilfully apply false lashes and breeze out into the night.

Well dear reader, it turns out I am.

My friend Amara provided encouragement and coaching. I watched Huda herself apply them in an Instagram video. She made it look not that hard.

And so, with a wedding to attend, I figured it was now or never.

First attempt was clumsy. They seemed huge, I could feel them attached to my eyelids, and they obscured my vision slightly.

But by the end of the night, having consumed at least an entire bottle of champagne and taken about 347 selfies, I was telling anyone who’d listen that they had become part of me.

‘I’m actually a cyborg now: part human, part eyelash’. You’re dead right, I am an entertaining wedding guest.

Wedding Selfie no. 243

So anyway, I pulled them out again for Cup Day, because well, why not look good if work is paying for your lunch and booze?

Cup Day selfie no. 67 – please note my crown

This time it was much easier; they stayed in place easily and I quickly activated cyborg mode.

Then this week, I lashed up for a Fierce Girl photo shoot (more to come on this). By now, I managed to do it no-stress, first time and at 6am. Kim Kardashian, eat your heart out.

The reason I am telling you this otherwise tedious story, is that it proves a point about life, cosmetics and investing.

I had previously approached the issue with a lack of confidence. I was overawed. “I’m not the type of person who does that”, I told myself.

But I’ve almost mastered it now, thanks to gentle encouragement, online research and a first attempt that felt, frankly, clumsy and uncomfortable.

I also chose a quality, trusted brand. (Surprisingly, the $3 ones from Daiso are vastly inferior to the $40 ones from Sephora. Who knew?)

If you’ve thought about investing, but been overwhelmed by it, you should take heart from this story. And the next one.

I met a bloke at the ASX Investor Conference in Brisbane last week. I call him a ‘bloke’ because that’s what he is: a salt-of-the-earth fellow with a broad Queensland accent.

If this were a meme, the conversation would go:

Nobody:

Absolutely nobody:

Queensland bloke: You know what, I’ve made an average of 7% a year since 1999 by investing in shares.

Consider: if old mate had invested $10,000 back when Britney was singing Hit Me Baby One More Time, then added another $500 per month, he’d have made up to $285,000 by now. (That’s an estimate only and doesn’t allow for the sequencing of returns, but you get the picture).

If he does the same for the next 10 years, it could jump to over $600,000, thanks to the magic of compound interest. As the Backstreet Boys said in 1999, I Want it That Way.

 

Oh baby, baby, how was I s’posed to know that I should have been investing in 1999, instead of drinking cheap wine and flirting with boys?

Following this unsolicited disclosure, I asked my new friend some questions. He holds about 25 stocks at one time (pretty standard). He picks them based on broker reports, media articles and a good old dose of gut instinct. His best performing pick was Blackmores – bought in at $10 and it’s now over $200 per share. Part of his rationale? He saw the products in the pharmacy and knew the brand.

He also picked some dogs, like Slater & Gordon, where he threw good money after bad. (Nothing about investing in a law firm sounds attractive to me, but … each to their own.)

He lost a lot in the GFC, but hung in there and the portfolio recovered over time.

And that, my friends, is how you make money in equities.

I’m here to tell you, if old mate Queenslander who lived on a farm for twenty years can do it, you can too.

There are different ways to access listed investments. A fund manager can do it for you, you can buy a low-cost ETF, a roboadvice provider can hook you up, or you can just choose them yourself. I’ve written a whole post about it here.

The overarching message is this: anyone – including you – can build their wealth through listed investments. You need some baseline knowledge, a willingness to try and a good deal of patience.

You can always start small – exchange-traded products don’t have a minimum investment. (Well, technically buying one unit is the minimum).

Of course you need to be mindful of risk and time horizons. A rule of thumb is that shares suit investors who have at least a five-year time horizon. That allows the ups and downs to balance out over time.

And diversification is important. Old mate had actually lost money on the property he owned (it was in the country) so was happy he had his wealth spread across different asset classes.

Long story short, if I can nail false eyelashes, you can totally nail the stockmarket.

From Arts student to Finance nerd: if I can invest, then you can too

I’m the least likely finance blogger.

I dropped maths in Year 12. Messed up chemistry because ‘I didn’t know there’d be so much maths in it!’.

Picked a university course devoted to History, English, French and Latin. Because of course employers want to know if you can decline a Latin noun (I can, but it hurts my head these days).

The important point here is that contrary to popular belief, you don’t need to be good at maths to be good at money.

The maths can be handled by the calculator in your phone or the Excel on your computer. All those times spent crying over an inability to do long division? Wasted. (Serves me right for being such a geek.)

Having observed a bunch of people in the finance industry, and quite a few rich people, I can tell you there are qualities that make you good with money that have nothing to do with your grasp of trigonometry.

Let me share a few of these qualities.

Confidence.

This is the big one. In the finance industry, it often veers off into arrogance, and while that can make people insufferable in conversation, it does help them to take action. 

Let me be clear, I’m not talking about being reckless. What I’m advocating is a willingness to educate yourself, do your research, form a view and then take action.

As long as you’re following the basic principles of investment, taking action is generally better than doing nothing at all. (Basic principles like don’t put all your eggs in one basket, don’t chase ‘get rich quick’ schemes, don’t borrow more than you can afford).

You can always start small until you build your comfort factor. Basically, if you can operate with even half the confidence of a mediocre white man, you’ll be fine.

Curiosity.

There is no one, single way to get ahead with investment. Some people swear by property , others love a managed equities fund and some think ETFs are the way to go.

Personally, I think a bit of everything is good – it’s pretty much how I think about dating: spread the risk and reward, and avoid catching feelings for anyone in particular.

But the key is to do your homework. Read about the things you might invest in; hear from different commentators and sources; pick up magazines or newspapers that cover new topics. Always keep learning.

One of the world’s best investors, Warren Buffett, spends five to six hours per day reading five newspapers and 500 pages of corporate reports.

I mean, if I were that rich, I’d probably allocate at least half of that time to watching Rupaul’s Drag Race and drinking martinis* … but you do you, Warren B.

Clarity.

It’s hard to get excited about anything if you aren’t clear on the ‘why’. Too many of us just stumble around with our money, hoping for the best. Will we have enough stashed away for Christmas, next year’s holiday, or some far-off but vague retirement? Fingers crossed!

Ladies, I want you to be crystal-fucking-clear on what you’re trying to achieve. If you’re saving for a specific thing, write it down, give it a timeline, give it a spreadsheet.

If you’re investing for the future, get down and dirty with what that future entails. Is it a lifestyle? A destination? A few years out of full-time work to raise kids?

Whatever it is, the more you can picture it and feel it, the more motivated you’ll be to work towards it.

Right now, I’m in a period of transition, and my old goals are giving way to new ones. (Hot tip: you can always change your mind about your goals). So now, I’m focused on a short-to-medium term lifestyle goals.

When I was in Year 12, my bestie and I would keep ourselves sane during the HSC by picturing the cute outfits we’d be wearing clubbing (picture Sporty Spice circa 1996).

Right now, I’m getting pumped about the ability to wear jeans, feminist-slogan t-shirts and a pair of Air Max 90s from my (possibly-excessive) collection. The more I can push those smart, corporate Review dresses to the back of the wardrobe, the better.

Sure, wearing trainers isn’t everyone’s jam.

But that’s the fun of it right? We all have different goals and dreams and views on footwear. But having clarity about your own goals is one of the best damn motivators around.

And guess what, I even made you a worksheet to help you work out some goals. You’re welcome!

So there you have it Fierce Girls. The Three C’s of Getting Rich.

That’s totally just something I made up then by the way. But it sounds convincing and who doesn’t love a listicle, huh?

Long story short, you can get on top of all these investing stuff, with a bit of time, attention and a touch of fake-it-til-you-make-it attitude.

*Probably have already overallocated my time to these pursuits, to be honest. 

Blog at WordPress.com.

Up ↑