Melissa Browne: The problematic reason women believe they’re ‘too old’ to invest

As a money expert, whenever I write about the returns you’ll receive when investing over 30 years, I’ll receive comments from women such as “what if you’re in your 40s?” and “what about those of us in our 50s?” and “I’m 35, am I too old?”.

To every one of those comments, I reply you’re not too old, you just need to start. Because the concern I have is that women are opting out of investing if they think they’ve aged out, when it’s so important that we lean in.

Besides, I’ve never met a single bloke who makes that same argument who is in his 40s or 50s. So why, as women, are we financially opting out?

My presumption is that it’s the same reason men are allowed to have grey hair and wrinkles. Most women are familiar with the concept of ageism, we just don’t realise we’re applying it to our finances.

My concern is with wage gaps, career gaps, superannuation gaps and now menopause gaps, it’s more important than ever before that we don’t discount ourselves financially because of our age.

The facts are, we’re living longer than ever before, and women are outliving the blokes. For males, the average life expectancy is 81.2 years in Australia and for females, it’s 85.3 years. I don’t know about you, but I intend to live well beyond that age, and I want to make sure I have the finances to live well. Yet, too few women do, and with superannuation balances at half of what men hold.

Those life expectancies mean, in every single one of those examples above, the entire 30 years of compound interest is available. Yet, the argument often is: who can afford to invest regularly when you’re in your 70s or 80s? My response is: we all can. Finding more cash is a skill – it’s just not a skill that’s taught to women.

The media talks to women about money differently

After all, none of us were taught ‘money’ at school, we don’t talk about it at home and the media talks to men and women very differently about money.

In 2018, Starling Bank conducted a linguistics study where they assessed 300 personal finance articles aimed at men and women. They discovered the media used very different language when it came to men, women and money. Across the stories analysed they found “in the sphere of finance, women are less productive than men: men make money; women are represented as saving small sums, making small amounts, or simply being dependent on men for the money they spend.”  In other words, men are taught to earn money and invest while women are taught to tighten their belts and stop spending.

That’s why part of what I do is teach women not simply to invest but how to find more cash. To be specific, in the My Financial Adulting Plan course, challenge two is to find $833 in 30 days. And only three of the 50+ ways I share is getting a second job, selling things or starting a business.

Two friends, two different investment strategies

Let me show you what’s possible when you do know how to find more cash and decide not to opt out of investing with a simple case study of two friends, Grace and Frankie, who celebrated turning 50 and decided together to start investing $500 a month.

Grace

Grace researched what to do and read that as you approach retirement, you should reduce your risk and start being safe. That made her nervous and she didn’t think, at her age, it was worth investing in shares as they’re a long-term investment.

Besides, she was already contributing a bit more to super, so she put her $500 a month into a high interest savings account. She did that up until she retired at age 65 and didn’t touch it for 15 more years.

At the end of 30 years, Grace had $223,979 in her savings account.

Frankie

Meanwhile, Frankie was tired of ageism, being told what she could and couldn’t wear, whether to dye her hair or not, and to be more conservative.

She learned how to find $833 a month and realised by doing this, she could continue to invest for the next 30 years – even when she stopped working. She was also contributing a little more to super, so she invested her $500 a month for 30 years into a broad-based ETF.

At the end of 30 years, Frankie’s ETF had grown to a whopping $1,083,143.

These are two fictional stories, but I have hundreds of real stories of women in their forties and fifties investing for the first time, buying property, starting businesses and choosing to put on their financial oxygen mask and build wealth.

With women over 55 in Australia most at risk of homelessness, we need to shun the idea that 50 is too old and realise it’s the age when we need to financially lean in more than ever.  If you’re in your 30s, 40s, 50s (or older), don’t buy into ageism and the lie that says you don’t have enough time to invest.

Be more like Frankie. The only one who will lose if you don’t is you.