There’s a big difference between the financial standing of men and women—and it’s time to bridge that gap. Lorna Tan of DBS Bank emphasized that women tend to be less confident in handling investments, which is why women prefer to put their money in savings accounts and conservative assets. However, Tan believes that women can learn to increase their profits once they learn and understand the basics of investments.
Investments are much like businesses because they require a lot of knowledge and skills before you can reap sweet rewards. As a female entrepreneur, you can invest like a pro by following these financial tips:
Build multiple streams of income through various assets
Purchasing multiple investment products may seem like overkill, especially when you’re just starting out in your financial journey. However, multiple assets can be beneficial for both your investments and your business.
Our guide on ‘How to Recession-Proof Your Business’ states that depending on a single source of income can negatively affect your personal finances and your business’ longevity during a recession. You can protect your financial status by buying investment products from different industries, instruments, and categories. This is actually a standard practice called diversification, and it helps with increasing your sources of profit while balancing out the potential risks from the products. By mixing it up, you can ensure that you’ll have enough cushion to sustain yourself, and therefore your business.
Create a financial plan based on your goals
You’ll need to follow a strategy for your investment products to earn your target profits. You can opt to buy and hold assets if you’re willing to wait, or you can purchase corporate bond funds and certificates of deposits for quicker gains.
As an entrepreneur and beginner investor, try listening to experts like financial analysts on what to do. There’s a high demand for these professionals within the financial and business sector. A post on financial analysts by Maryville University reports that they could even experience an 11% growth rate in the job market within the next decade. More people are working with financial analysts because they can assess the financial performance of investment products and help develop investment strategies that can give you the best returns on your investments.
Assess and manage the investment risks
Many women hesitate to invest due to the risk of losing. However, you can earn significant profits from high-risk assets, especially if you know how to navigate risks.
Universität Tübingen and the University of Hohenheim researchers discovered that female fund managers like to play it safe when the market isn’t doing well, at least compared to their male colleagues. This is a good strategy in bear markets because you’ll get the same returns with less exposure to risk. Once the market is on the rise, you can make use of stop-loss points, diversification, and downsize put options to protect your high-risk assets.
Learn how to mitigate the taxes from investments
Taxes can reduce your earnings from investments. To maximize your profits, you have to study how to mitigate these tax cuts.
If you want to take your earnings from stocks, US News states that you can add in all the reinvested dividends to increase your costs basis and reduce your capital gains after selling. Meanwhile, those who invested in real estate can exempt up to $250,000-500,000 of their home’s appreciation from capital gains tax. You can also invest in qualified opportunity funds to get tax-free profits.
There’s no better time to start your investment journey than now. Arm yourself with these investment tips to increase your financial wealth and protect your business.
Article written by Rebecca Janine
Exclusively submitted to imlovingme.net
