Thursday, April 22, 2021

Choosing Stocks, As A Woman

 I have recently gotten very involved in the stock market.  After my dad died, the brokerage firm where he had been doing business kept calling me and encouraging me to sell my Chevron stock.  It had dropped significantly in value.  I did not have a diversified portfolio, it was just a few stocks, with most of what I owned in Chevron.  I declined, and told them that I planned to hold the stocks for twenty years.  My approach at that time was one that  came to me intuitively: a third in land/real estate, a third in stocks, and a third in cash.  I just felt that it made sense.   I learned later that this was an ancient Jewish tradition.  Interesting, since I'm not Jewish.

As time went on, and my deceased parents' home sold, I started researching dividend paying stocks.  I watched Youtube videos made by investors who live off of their dividends.  This is what's called passive income.  That's what my dad did.  He sold his business before retiring, and invested that money in the stock market.  He checked his statements online daily, and didn't trade.  He lived off the interest and reinvested the dividends.  He also owned some land and a paid off home that went up in value.  California real estate has soared.  

I decided to mirror his approach, on a smaller scale.  I researched the companies that interested me, and linked my bank account with my brokerage account.  After finding the stocks that are at the price I feel comfortable with, I transfer the money for the desired amount, and then send my broker an email.  He calls me back to take the order over the phone, and it shows up on my computer screen once it's executed.

Many women are afraid of the stock market.  Suze Orman recommends only investing there what you can afford to lose.  She suggests having at least twenty different stocks, so that if one goes down, the others will probably equalize it.   It's not hard at all.  Once you start looking at your stocks each day, you memorize the companies, what you paid, what you've made, and which ones have dropped or risen in value.  It's kind of like checking what your home is worth on Zillow.  Just because it goes up or down doesn't mean you sell it.  This strategy is buy and hold.

My dad used to tell me that he managed his investments instead of working.   Now I see how wise that was.  I make far better money in quality stocks than I ever made teaching ballet or yoga.  Many artists struggle, and put everything into their art.  

I think that women can be excellent, disciplined, and successful investors.  Many trust other people to manage their money, and those advisors may behave in a reckless or self interested manner.  I believe strongly in making your own decisions with your money.  No one is allowed to touch or trade my stocks.  If you understand the companies, and feel that they'll be around for the long haul, you will probably feel safe with your portfolio.  

Once the dividends start coming in, it gets exciting.  You do need to plan for taxes, so that you aren't surprised when you owe money.  It's all part of the discipline, and helps you to earn interest on your money.  This way you beat inflation.  

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  1. You are doing really well, managing your money, Stephenie. Well done!

  2. Thanks, Bless. It is so much easier now, with computers. We can check our accounts online.

  3. Sound advice indeed. I am also amazed at women who seem afraid to organize and work with their money.

    1. I think fear can paralyze women from taking action. There is a lot of helpful information out there, but you have to study and learn.