Episode 34: When should women invest?

August 30, 2021

There is a large gender gap when it comes to financial literacy. One aspect of this is women investing to improve their own wealth. In this episode Trudi and Sarah are join by Natallia Smith of Tru Wealth Advice (link to her website) to discuss the very important topic of When should women invest? Natallia works primarily with women and therefore has a unique insight to the attitudes of women to investing and what causes hesitancy to take control of their own money. Trudi and Sarah talk to Natallia about some of the way's women can get started in investing as well as some of the different investment options. Natallia also talks about what typically causes women to seek investment advice and why they should start earlier and not put it off until retirement is calling. This episode is a reminder that your financial life and stability is 100% your responsibility and also within your power regardless of your circumstances.

Podcast Transcript Available Here

Duration: 24:36

Trudi Cowan: Welcome everyone to another episode of the Financial FoFu Podcast we are recording from lockdown today so apologies in advance if we do have any crippling or technical issues in the background. Today we are joined by Natalia from True Wealth Advice. Natalia has been in the financial planning industry for over 15 years. And during this time has worked as a private wealth manager at Macquarie, as well as working previously at ING. She's now the founder and director of her own firm True Wealth Advice. Where she specializes in working with women to achieve their financial goals. Welcome, Natalia. Natalia: Yeah. Lovely to be here. Sarah Eifermann: Natalia and I actually met like eight or nine years ago, professional development day. That was a long time ago, how is it going today, Natalia? Natalia: Yeah great, feels like only yesterday, to be honest. Trudi Cowan: And lockdown for everybody. Most people are locked down at the moment so yes, once again we do apologize for any crackling, or dropouts, you may hear everybody is using their internet connection right now. might be great to start if you can give us a little bit more background about yourself and what you do. Natalia: Absolutely, yes, as you mentioned, I work with them, women really focus on helping single women, divorced, single or, You know, widows, maybe women just to really get to their next phase in their life, from a financial point of view, and you know it's a lot of coaching, a lot of hand-holding but at the same time navigating a very complex world of financial planning, and trying to help them feel confident and independent. Trudi Cowan: Yeah Wow, the big task isn't it with one in two women financially illiterate in this country, where does that leave us as women in terms of financial decisions. Natalia: Absolutely and I think it's really having social media is fantastic because I think that, you know, we can actually know more, and there's a lot of information out there, but at the same time how do we actually get to know what we need to know. and navigate to the very complex borders of financial planning. Trudi Cowan: Awesome. Do they need to come and speak to you or a financial planner in general? Natalia: Well, there's always a trigger point, well not always but sometimes there is a trigger point where if there's a separation or divorce and I've never managed financial affairs themselves that partners used to do it for example. So that's when we would help them to familiarize themselves with what needs to be done, how to budget how to manage the expenses, how to actually get to a better place, and understand and be in control of their financial affairs. But also if there is an inheritance that just came through, that's happening quite a lot as well. Trudi Cowan: Yep. Yeah, better a little bit broader than just, I guess, investing, it's more about a whole picture of how Natalia: Absolutely, it starts with you know your cash flow management starts with understanding what's happening with our lives. From a financial point of view. And then, savings, working for us we've got investments we've got supervise. those really are part of that. Trudi Cowan: So, who are your typical clients, and is it just women are the women of a particular age? Natalia: Yeah, mostly, and most of the pre-retiree women I think that's, that's another trigger events, sometimes when we are younger, we don't really think about longer-term. When we approach cognitive 50 I think, age mark, that's when we start thinking longer term, thinking about our retirement, and how we can actually force the time. Trudi Cowan: Yeah. Okay, awesome. Well, I suppose the question of the day, but today. When Should women start investing? Natalia: I would say, from the very beginning. It's really important that we've got that part of our life, it's, it's just something that we don't start, we obviously need to learn how to do it first. And we did start earlier in our life when we observe as opposed to in the family unit we see what our parents do with their money, whether they save, invest and having those discussions with your children are really important, because they feel that it's part of our lives when we obviously plan for any future purchases we need to save money, and for anything we need to invest as well so having those discussions, early in life, it will help us to get used to it. Help us to be aware of that topic. Trudi Cowan: So one of the questions or one of the comments we had in our episode was around this sort of conversation about if you don't learn it at home. Where do you then learn? So what would be a topic for anyone listening today that didn't actually get a fundamental attachment that has broken off? Where would they see where should they start to learn about based on finances that you see? And what they need to know to invest. Right, there's a big gap between having no knowledge and being able to make decisions first. Natalia: Absolutely. So I guess, probably, understanding and learning from your peers. We don't talk about money that's probably one of those issues, we don't really talk to our friends about money, but we should, we should, and it is a big part of our life if you think about financial wellness how it's just yet, so. And also, you know, taking an interest, I feel like sometimes we just feel it's something that I don't need to worry about, but it's actually it's really important learning as much as we can but also listening to people like professionals really interesting podcasts or reading books about financial well being, or financial sort of wealth creation. Yeah, that's probably a very good first step. Sarah Eifermann: Yes, recommend anyone that hasn't actually listened to the International Women's Day episode that obviously came out in March, to go back and listen to that off the back of this episode because there's some awesome information that just mirrors exactly what you're saying right now. So, what identifying these because we are in this industry we have some knowledge about it Trudi and I will talk about that, and I will talk with other girlfriends we've never had that conversation because we have the knowledge and the confidence to get so we do. Trudi Cowan: And it's normal for us because it's part of our everyday lives because it's part of. Natalia: Yeah, that's right. Yes, right, but also very important to actually make those first steps and make mistakes. I feel sometimes we as women are trying to be too perfect. And if we don't have enough. Look, we think oh you know to invest, you need to have $100,000 Now, it could be very small amounts, it could be very simple and there are currently there are products out there that will let you invest with very small amount of money, which is fantastic and that's how you learn, you'll only learn by actually doing it, and making those mistakes. Trudi Cowan: So that's how you can start investing, by just having absolutely awesome. That's fantastic, we can show you some of those products. Application. Do you have any concept is a very well-known platform that he could try shades, we're not recommending it but there are lots of different platforms, along the same vein of concepts. Natalia: True, true, but then more. You're lucky you can actually purchase Australian shares, where the applications we're talking about like arrays and spaceships or things codes are beginning, I don't know if that's correct, but they actually are an application that lets you invest, very small amount of money into their product, Trudi Cowan: Are they the ones that take the rounding out of your purchase and investment. Yeah, yeah, yeah, yeah. Natalia: And I guess that's where, even every second client that comes to me for example says I'll try them before they, you know, I like them. But when you start thinking or talking to them about actually the underlying investments, they're not sure what they're investing in, Trudi Cowan: One is behavior and every other. Yeah, so we're talking about creating something that you can have the knowledge to make a decision. And so, I suppose that application, like a race, is something that behavior changes, whereas in decision making. I find that's fine, especially because you're very bad like advice without a better quality. Natalia: Absolutely. And also, I guess those platforms are really good for learning. Obviously, knowing that we don't put all our eggs in one basket, we wouldn't invest all of them. But, yes, that understand how it works, that you can actually, there are risks involved in investing, and you can potentially lose all your money. Just a nice kind of the first introduction to the world of finance and investment markets, absolutely. Obviously, you know we can build on that we can learn more about okay what is the share. What is an investment, or managed funds or exchange-traded funds, you know there are so many different options for consumers to choose from and sometimes it is confusing. The other guests are always referred our clients to go to the Money Smart dot after the au website, and that is the government website it provides a lot of information about different types of investing. You know, it's fantastic it's a great resource for those people to learn. Just the very basic that fundamentals. Trudi Cowan: Yeah. So, my grandma. Always used to say Never invest more than you are prepared to lose. That's right. That was. Potentially, yes. She always finds themselves in a position or Natalia: Well I think it's optimal to look at any investment that has a risk attached to it. So again, that's just one of those fundamental principles of investing, you need to always consider the risks. At the same time, different businesses have different levels of risk. The other part to it is obviously your goal, what are you trying to achieve. When yes yeah absolutely so but it's not just for the sake of investing. I think it's to try to learn and to see how it all works, but once you start talking about more of a serious plan and serious kind of, I guess, investment opportunity then you start thinking about what am I trying to achieve is it for, for a purchase of the house, you know, or is it to build my wealth for the future. Is it for me to maybe accumulate enough funds that sort of passive income coming to make enough, you know, all those things really important and that's when we start talking about the time frame. How long do we invest for Trudi Cowan: Different investments are going to keep better for different roles in different circumstances. Any, anything, always relates to your circumstances, and your look like so many different factors change based on the argument. Yes. Yeah. So that's why we always put up these disclaimers when we have these conversations around, you know, this is general conversation and if you really want that advice, it does vary depending on your very particular circumstances. Okay, great. Now, shares is obviously an investment option that many would probably be familiar to a lot of people but what are some investments that you help your clients with. Natalia: Absolutely. So you've got in the universe of investments you've got your shares that are an individual listed company that you can invest got also your managed funds. It's a unit structure, or ownership so we buy units in a fund, and that could be again Australian managed funds international niche property. So it is a very similar concept to you. I suppose invest money through a managed fund, they help you invest in companies. It is an extra layer, I guess, of the asset as opposed to buying. Correct, correct, yes. Yeah. You know they have been quite popular. They allow people to visit a smaller amount of money but also they diversified, whatever with a particular single stock he just bought one. When you buy and manage bundle Unison the managed funds, you buy a portfolio. Trudi Cowan: Right so diversification. Natalia: That's right, absolutely. And then over the years, we've got some other products that just came to the market and you've got exchange-traded funds, which is basically a simple concept. It's a diversified portfolio, but you buy, on, on the market on a market you're listed as a listed entity. And also it if you invest in an index, so you instead of buying individual shares you actually buy all shares in this particular index which is for example es six 231 So ASICs are categorized. Trudi Cowan: So the ASX. 200 shares with Australia. Natalia: And then you've got some other types you know you've got your listed investment companies which is another structure so there is more complexity in terms of the, you know how many products are there, and it's getting more and more complex, so I think it's really. Obviously, this is where your financial advisor can help you understand what do you actually need in your personal circumstances but it really depends on where you're at in your, in your journey. Trudi Cowan: I used to work as an investment that most people would have and probably don't necessarily think about it, is their superannuation. Do you find a lot of people don't really understand this? Natalia: It's getting much better. Absolutely it's getting much better, probably 10 years ago, it was very awkward still here, you know, some people would say no I don't trust. I don't trust superannuation. Probably the difference that which is great. And also, a lot of younger clients the younger generation they take interest as well which is great. It is your money, it is, you can have access to until you're a certain age, but it is your money, and it is important to nurture it and to ensure that it's in the right investment option as well, Trudi Cowan: Because you can have a say, what types of things is invested in. Natalia: Absolutely. You don't have to have a self-managed super fund you can still have just a normal Industry Super Fund or retail super fund, and still, Choose your investment option, Trudi Cowan: You get to choose to challenge our listeners who have never looked at what their money's invested in Super to go and have a look. It might not be a strategy conversation that you talked about earlier. Because you've got to make any losses, just tweaked the way I've had otherwise. To actually retire. So that was a conversation. Natalia: Most people don't really know the investment options now, it's not really clear in this statement. Unfortunately, in my experience when I ask most people don't know, the investment option. By default, that's right here and it could be default but what is the flood, is it in, in cash, is it in the balanced portfolio, or is it in the homeless portfolio. It is really important because if you're a retiree and you are just about to retire, you know, having that high growth option, potentially maybe not be the best structure for you. Trudi Cowan: Yeah, exactly, exactly goes back that time, Natalia: And I suppose, like, a lot of others probably, I just wanted to run it my own way and really help people that are called to help before. And that's what drives me to work with single women really educate them and help them. Excuse me achieve a better outcome with their money. Well, currently. Absolutely. So it's, you know, we, everything is aligned. But no, it is all Australian-based law. Trudi Cowan: That's fantastic. What's the number one thing you would recommend that someone look for in a financial advisor. Natalia: For me personally, is independence, I think if there's that point of an extra layer of ownership attached to it, you always ask, okay, you know, there are strings attached. Like, Is there anything that I should be aware of? Personally, that's what I always look for in any other professional I guess if it is a business that is related to a product in a way that is an example. For example, for example, they will have their own funds, and you know that some of those funds will be fantastic buttons, but that. That's not to say if you go to a particular dealership and he, you know, you want to conduct a couple of you know you always will be sold one product. So that's, for me personally I always look for that independence and, you know, really. Yeah and not being attached to the product providers, such. Yeah, but also it's all about, you know, their personality and how, because it is a relationship business true. It's not just about the product, it's not just about the investment, because everyone can do a great plan. Well, not everyone, but most people can set up a fantastic plan and help you implement it, but at the same time you have to work with that person. I have the same values as us, because you are very strong with, for example, Ethical Investments, and you want your money to make a, you know, an impact on the world. You come and see somebody who just thinks absolutely in a different way than potentially might work. Trudi Cowan: Yeah, yeah, stability, and those needs. From investment, because the relationship for like one week is not optimal. That's right, yeah. Awesome, well. So once you get started with one thing. Natalia: You just really have to go, and even if it's if it doesn't work here, it is still something that you, you've tried again don't put all your eggs in one basket and don't invest all of your money, but it's really just about learning, and we, that's what I always encourage people to learn and their mistakes and to make that extra commitment and stuff. Trudi Cowan: It's not always about what's one of the things, but it's also, it's that capacity. Any final words before we wrap up for today? Natalia: I'm happy to help anyone who is in need just even through chat. Obviously, it's quite a financial sort of market. So, in a financial planning industry, it's quite a big bit of a diverse, complex and sometimes we will fill up, what I see my clients they feel they're not confident. Don't want to ask stupid questions and obviously there are no stupid questions, there's just, it's a different industry and the model, you know, you might not know something, but sometimes we don't know what we don't know and sometimes we know more than what we think we know, by asking questions, I think it's very important we actually actively asking questions and we're actively trying to improve our life and your preferred financial position, so I'm here if anyone needs a bit of encouragement or just extra, I don't know, just didn't have a chat. Sarah Eifermann: Fantastic. Thank you so much. I'm trying to. Thank you so much for joining us, Natalia. You've been listening to Financial FOFU, I'm Sarah Eifermann Trudi Cowan: And I'm Trudi Cowan Natalia: Thank you so much. Bye for now. Trudi Cowan: Bye.

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