It’s important.

How to handle your money better, starting now

One money expert shares tips and tricks on saving, investing and just, you know, getting started

By Julia Carpenter

Am I investing enough?” “Am I saving enough?” “How do I even get started with this stuff?”

These are the questions every woman will encounter, at any step of her career.

Maybe you check in on your savings account every now and then and try to pay your credit card on time — but what do you do beyond that? And when is it too late to get started?

Jonnelle Marte is a personal finance columnist at The Washington Post, and her reporting addresses questions about investment, debt, money habits and more (you can see her writing here). In a Q&A with Pay Up members, Jonnelle chatted about the basics of wealth management, and shared some guidance on money milestones, savings goals and more.

The answers below have been edited for length and clarity.

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The gender wage gap strikes again.

Q: What’s a good place to start investing if you know nothing about it? Where can I go to learn how to grow the tiny bit of wealth I currently have?

A: Excellent question, and one that may become more nagging especially once you start to feel like you’re no longer drowning in debt.

I’ve been writing recently about how people can start investing even if they are starting small, with 100 bucks or $1,000. The idea came about after I saw enough studies about how millennials are holding cash. Apps like Acorns and Stash make it possible to start investing with $5. But if you have more to work with you can graduate to a brokerage account somewhere like Schwab or E*Trade. Most people who are just starting out should probably keep it simple with index funds, and companies like Betterment can help you come up with a simple portfolio

Bottom line is, if you don’t know much about investing you don’t want to make big bets on any one company or trade too much. Investing simply with index funds is probably best. If you really want to own one company you can do that too, but keep the investment small and understand the risk. It should be viewed as play money if that’s what you’re going to do. Make sense? I dive a little more into the different programs here.

Q: Does gender play a role in how we invest? Specifically in the risks we take? And what do you think of companies like Ellevest who cater specifically to women?

A: There are differing views on this. There isn’t enough evidence to say definitely that women are more conservative with their investments than men. But women like Sallie Krawcheck, who founded Ellevest, have a point in saying that a lot of financial advisers have not done enough to hear from the women they serve. That’s why she started the company and why you see more and more companies like Learnvest targeting women specifically.

One of the biggest issues for women is that even though we are just as likely to save for retirement, we have less money to work with overall, and therefore save less. It doesn’t mean we are being more conservative.

Every little bit really *does* help.

Q: What advice would you give for a woman who is afraid she’s playing it too safe with investment? What’s a good first baby step?

A: The first question to ask is usually, what is this money for? If you are saving for a down payment for a house you want to buy next year, you should be safe with that money. But retirement savings for an event that is three decades away? You should be taking more risk there.

Good guideline for figuring out if you should invest is that you don’t want to take risk with any money you’re going to need in the next two years. But if you won’t need it for eight to 10 years, you probably have enough time to allow that money to recover.

That said, you also want to make sure you really won’t touch that money if the market does collapse. A scary question is “Will I leave this money here if I lose 50 percent?” Which is what happened during the crisis. But people who did not touch the money came way back, and then some. So be honest with yourself.

Q: How can I find a “good” (trustworthy, smart, etc) financial advisor? I’ve heard CPA, but is any CPA going to be ok? Is there a rating system?

A: I saw some good thoughts on this earlier. Someone smartly pointed out that a CPA is a pro to help primarily with taxes. People who are working on estate planning or just want to manage some complicated income situations can get help from a certified public accountant.

The question you should really ask yourself is: how much hand holding do you need? Some people have simple goals: pay off debt, save for a house, etc. And they don’t need a pro to walk them through it. But if you want someone to help you work through a lot of competing financial goals, then that’s where it can help to talk to a financial planner or a financial adviser, which are two different things.

A simple way to think about the difference is that a financial planner will help you come up with a to-do list, help you figure out what to do first. but you would be the one doing it all. And you only pay them basically for the time you spend with them. a flat fee.

People who want someone else to do the work for them might hire a financial adviser. These are people who actually manage your money for you, typically for a fee that amounts to a percentage of the money they’re managing. As for how to find the best person, I’m not against asking friends and family for suggestions. Just don’t stop there. You need to make sure these people are legit. Learn from Scottie Pippen, who got scammed.

Start early.

Q: If you do stupid stuff when you’re younger and end up with a lot of debt, how do you deal with getting out of it?

A: It’s not hopeless. There’s no easy way. But the key is to lower how much you spend on the big bills to free up how much you can dedicate to getting out of debt and then to saving.

For instance, I wrote about a couple who was making aggressive payments on their student loans. I forgot how much but let’s just say it was $1,000. And the second they were done with the debt payments they started saving $1,000 a month.

And then it felt great to see that money piling up in the bank. Plus, they kept their living costs the same and when one of them got a raise, they banked all of that too.

So bottom line is to try your best to avoid bumping up your costs when the breaks do come. So you can go from negative to positive, in the words of Biggie. You don’t have to be debt free to start saving, but you def want to do what you can to get rid of the most expensive debt.

Q: I just turned 25. What is the most important thing I should be doing with my money right now?

A: If you’re thinking about this stuff at 25 you’re ahead of the game. On top of the things I just mentioned, like paying off debt and starting to save, you also want to start saving now for retirement.

Even if it’s not a lot, saving a little bit in your twenties can go a long way because that money can grow over time with compound interest. Not saying that you’ll be fine if you only save 3% for your entire career. But if that’s all you can afford to start, then start with that and increase it over time. I’m a fan of auto escalation in 401k accounts, which increase your contribution rate by 1 or 2 percentage points each month.

Another big thing is to have some sort of an emergency fund. Even if it’s just a few hundred bucks to start, it can keep you from falling behind on the rent or piling on debt when your car breaks down. And building it up can get you in the habit of saving. plus when that is set up you can start investing!

Start thinking about the other goals you’ll have coming up. Do you want to spend time traveling? Do you want to buy a house? Or start a business. You can start saving for those things now. And just build on all of this as you get older and hopefully make more money.

Pay Up is a private, Slack-based community dedicated to fostering conversations about the gender wage gap. It was formerly managed by the Washington Post.

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