‘Start Small’ If You’re Intimidated by Investing, Says Money Confidential’s Stefanie O’Connell Rodriguez
The Financially Savvy Female had the opportunity to chat with Stefanie O’Connell Rodriguez, host of Real Simple Magazine’s “Money Confidential” podcast and founder of the weekly newsletter “Too Ambitious,” which covers ambition, money and power. Here, we chat with O’Connell Rodriguez about her own personal finance journey, and how women can build their financial confidence and knowledge.
What was the most impactful move you made to break out of the paycheck to paycheck cycle and be able to afford the life you want?
Earning more money, without a doubt. I’d become a pro at managing what I made and finding ways to be frugal, but you can’t out-frugal your way to wealth.
What steps should all women take to build their financial confidence?
I’m a big fan of learning through doing. One of the biggest roadblocks I find people face with their money is stressing about not making the optimal choice with their investment strategy or debt-pay-off journey or budget, so they wind up doing nothing at all, stuck in analysis paralysis, overwhelm, etc.
To break through that and build confidence, I prefer to start small. With investing, for example, maybe it’s contributing 1% of each paycheck to a 401(k) and then using those small contributions to learn along the way as questions come up: What is a brokerage? What is an index fund? What is asset allocation? etc. I find the answers to these questions are much easier to process when you’re using them for practical application. And that practical application can help build not only your competence, but your confidence. Even if you don’t make the most 100% optimal choice — if you make a 50% optimal choice — it’s typically better than doing nothing, and you’ll likely learn something along the way.
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What area of finance do you believe all women should make an effort to get educated about?
I find that all genders typically feel least knowledgeable about investing, though women report feeling even less confident than men — likely as a result of the pay gap and thus having less money, they feel they can’t afford the “risk,” not to mention the male-dominated wealth management industry.
To build this knowledge, I find it helps to build community with people who are working to reach similar goals and hold similar values — whether that’s a friend you can talk out your hesitations with, or an online forum where you connect with other people who are facing similar challenges, like balancing investing against student loan payoff or saving for kids’ college educations at the same time as funding your own retirement. I know a lot of the “loudest” dialogue around investing — like the headline-grabbing NFT, crypto, day trading dialogue of 2021 — can feel off-putting for many, but I’d encourage everyone to find the conversations and communities that resonate for them.
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Jaime Catmull contributed to the reporting for this article.