Ladysplaining the point

When I got my first job as an aspiring investment analyst, a person who devotes their whole day to researching and then predicting if a group of 15 or so stocks is going to go up or down, you could say I was at the tip of the spear for the entire financial world. The job is hard and grueling, and for good reason. You really want and need to be right. The mutual funds (I promise I will explain all this later) that buy the opinion of analysts need you to be right because they put those stocks in their fund, trusting that it will go up like you say. And then the world buys those funds. It’s teachers and pensions and engineers who put them in their 401(k)s. It’s all those financial advisors around the country putting their clients in those funds.

So, it is a big deal.

This blog is not at all about whether we got it right or wrong. It’s the fact that we treat it all like a big deal.

So back to my story. The job, while grueling, is an amazing opportunity. It is analytically rigorous. It is as insider as anyone can ever get on how stocks work, how to value them, and how to buy them. Literally it would make me the most qualified person to tell people what to buy and to buy stocks for myself.

But here is the honest truth--the shameful, scary fact that you deserve to know. I was not going to be able to retire. What I didn’t realize as I was working 10-12 hour days, was that I had inadvertently elected to save 5% into my retirement plan. In fact, not only that, but I had hurriedly chosen a handful of mutual funds (again super embarrassing to admit) by just their names. And the names were crazy—literally, one cannot decide which funds to buy based on their names. But I remember the moment I signed up for it all. I thought, “I will think about this later, after I get more settled.”

Then I never thought about it again.

Women tell me all the time that the reason they did the exact thing I just described—accidentally chose too low of a savings rate and either picked funds through random guesses or even worse, just put the money in cash—and it’s because they don’t describe themselves as finance people.

Let’s cut to the chase. The world of finance as we describe it will not make us retire. For some reason it has been decided that retirement planning is interchangeable with investment management. And the financial world as we know it has laser focused on investments. And that’s how it makes money. I will get into that next week…you gotta follow the money. Because people make money on only the investments, it is in the best interest of the financial markets to seem and act complicated, to use complicated jargon, to make you believe it is an important club that you have to join if you ever want to retire, send your kids to college or buy that dream home.

Maybe you have experienced this or have a girlfriend who has. You are sitting in an investment advisor’s office, and he is, if you will, “mansplaining” investments. It’s complicated. You just want to get out of there.

The very complexity that it creates is not in your interest, however, because it confuses and alienates. It makes you think, “I will get to this later.” It makes you think “I am just not a finance person. I am just not a math person.”

“Ladysplaining” is meant to combat that very scenario. Through humor, stories and understandable explanations, I want to offer YOU a seat at the finance table. Let’s cut through the noise, cut through the complication, cut through the massive industry conflicts of interest, and offer what I believe people really ought to know. And the reason I am the one to tell it is that I know the industry from the most intimate perspective. I can take all the complex issues that I understand and bridge the jargon and communication gap. I want you to understand these financial concepts for the simple fundamentals that they are, not the complex high-level business math that they seem.

I will offer blogs over time that will take very specific investments, financial decisions, etc. and put them in the context. My goal for my readers is that over time you will feel less alienated from the financial world. Only then will you be able to make important decisions, like how much to save to be able to retire, where to physically put that money, and how to think about investments.

It’s time for the ladies to get a chance to ‘splain how it all works.