5 Lessons Men Can Learn From Women in Business and Investing
There is a saying that goes, “Behind every successful man is a powerful woman.” In my case, this saying is definitely true. I would not have achieved success, if not for my wife Kim. Sometimes I wonder where I would be if not for her.
Obviously, when I met Kim, it was her outer beauty that attracted me.
But on our first date, I found out she was not just a pretty face. She had a brain. She was very smart. As we got to know each other, I found out she was more beautiful on the inside than on the outside, and that is when I fell in love.
When Kim and I first started dating, we did a fun and helpful exercise together that helped us discover whether we were a good match for each other.
One night, we each had a 3×5 index card on which we wrote the top ten values we thought the other had as a person.
When we were done, we compared our lists. We had some in common and a few that were different. But importantly for both of us, the things in common were big ones: money, business, and investing.
At the end of the day, the thing that attracted Kim and me to each other was our alignment on some of the most important things in life — money being one of them.
Now, at the time, neither of us had any money to speak of! But we did have the same values, passion, and mindset around money. We knew that our commitment to financial education would result in money down the road, and we wanted to be with someone who would be a good partner, both in life and business.
She had an inner strength that carried us through some of the toughest times I have faced and doubt I could have gotten through without her. There were many times — times when we were out of money, no roof over our head, no transportation — that she would hold me and let me just cry like a little boy.
She was the brave one, the backbone, the one who never lost faith in our mission or in me, although I had lost faith in myself.
Now, I have to be honest.
When it came to investing we had different approaches or ways we would look at an investment, neither good nor bad, just different.
Below are the five main differences Kim and I experienced along the way…
1. Women aren’t afraid to say “I don’t know”
I would say, by far, the number one advantage most women have when it comes to investing is that they are not afraid to say the words, “I don’t know.” They are more willing to ask questions and admit when they don’t understand something.
Men on the other hand—especially me in my younger days—often let their ego get in the way and they pretend to know everything. An old proverb says, “Arrogance diminishes wisdom.” Rich dad believed that arrogance also diminished your riches. Applying this to money, my rich dad said, “What I know makes me money. What I don’t know loses me money.”
2. Women are more willing to ask for help
Piggybacking on #1, the second advantage a lot of women have is that they are much more willing to ask for help than men are.
Rich dad said, “The most successful people in life are the ones who ask questions. They’re always learning. They’re always growing. They’re always pushing.”
Conversely, rich dad said, “The losers in life think they have all the answers. They can’t learn because they’re too busy telling everyone what they know. They can’t grow because they’re too busy telling everyone else where they need to grow. They can’t push because they think they’ve already arrived.”
Over the years, I’ve taken rich dad’s lessons to heart and try my best to always ask questions so that I can learn, grow, and push myself to become more successful. I do not take where I am in life for granted and I do not think I have all the answers.
3. Women do their homework
Women, as a general rule, do their homework. Women do not typically buy off a “hot tip.” According to the National Center for Women and Retirement Research (NCWRR), women spend more time researching their investment choices than men do. This prevents women from trading on whims and going after the “hot tips” –behavior that tends to weaken men’s portfolios.
We should always be moving forward with our goals and financial education, but prudent people also plan, and they do so with the help of advisors. As the old proverb goes, “Without counsel plans fail, but with many advisors, they succeed.”
Each year, Kim and I sit down and plan out our financial goals for the upcoming year. We then plan out the steps and timelines for those goals to break them down into measurable steps for success, and finally, we meet with our advisors to get their feedback and wisdom.
One story I’ve shared before is my Bentley fund. I wanted a new Bentley, and though I had the money to buy one outright, I instead developed a plan to buy assets that would provide cash flow to cover the cost of the new car. I worked closely with my advisors to establish this plan and knew it would take about a year. Patiently, I executed each part of the plan, and in about a year, I had both a new cash-flowing asset and a new Bentley. It took patience and knowing when to act, but the delayed gratification was worth the effort.
4.Women are not risk-averse, but more risk-aware
Studies have shown women to be “risk-averse” as compared to men. I’ve heard arguments that the reason women will not be as successful as investors as men is because they are less willing to take risks. And yet, studies show women are consistently BETTER investors than men. Perhaps this is because they are prone to take only calculated risks.I know for Kim, whenever she would venture into an investment that she feels is a bit riskier or unfamiliar with she would tend to study it a little more than usual and do her homework with a little more effort before laying out a lot of money.
5. Women have much less ego
It’s no secret men can tend to display a bit of ego or bravado when showing off their investments.
As a young man, when my Velcro wallet business was failing, I met with my rich dad to talk about the business. My hope was to get some advice to turn the business around. So, when he told me the business had terminal financial cancer and that I needed to close it down, I was not happy.
In my arrogance, I tried to convince him that it wasn’t as bad as it was, but the truth was I couldn’t read my own financial statements as well as he could. One look at my financial statements told him that my ignorance and arrogance had clouded my judgment. I eventually liquidated the business and paid off over a million in debt. If I hadn’t done that, things would have been much worse.
At some point in our life, we’re all arrogant. I’ve found that men most often are arrogant when they don’t know something, especially when it comes to financial education. They may have a little bit of knowledge but not enough to be an expert. Instead of being humble and admitting they are not an expert, they are arrogant and try to make you think they are an expert.
Editor, Rich Dad Poor Dad Daily