Women Investing Now. A few years ago, I had a crazy idea to form an investment club for black women. Our club met for about 6 months, and eventually, we fizzled out.
Over the past few weeks, I've gotten clearer about my purpose and double-downed on living my dreams. I've cast the doubts and naysayers aside, and I'm ready to get back in the market! Are you ready to join me?
So, what is an investment club?
An investment club is a legal entity (usually an LLC or partnership) formed to buy stocks, mutual funds, real estate, and other assets together. Many years ago, commissions were really high, and investment clubs provided a way to save on commission costs. Instead of 10 people paying $50 each for trade, 10 people would pay $5 for a joint trade. Commission costs have decreased shortly over the past few years, but investment clubs still exist and are thriving.
Who should consider joining?
You are interested in learning and growing with other women. Maybe you know about stocks, bonds, mutual funds, EFTs, and the sort. Perhaps you don't. But, you want to become more knowledgable about finances.
You have time to do the homework, such as researching stocks, serving as an officer, etc. It's not a part-time job, but you definitely don't want to be a passive member. The more you participate, the more you will learn.
You're ready to make a long term commitment. Most clubs require members to participate for at least 24 months.
You have disposable income! Investment club dues vary by club. Some have a $50 initiation fee, then $50 per month, or others are substantially more. I'm thinking more about $50 or $100, but that's something the group will decide. Will also decide on an investment strategy. Perhaps, we'll look at only socially responsible companies or women-owned businesses. Who knows? The group will decide.
You understand there is no such thing as a get rich quick scheme. As mentioned above, it's a 2-year commitment. Slow and steady.
You're single, married, or divorced from 21 - 99 who works in corporate America or is a business owner. Get it? There are no set criteria. I'm looking for strong, intelligent black women who enjoy learning and WINNING. But, most of all WINNING with other women.
Although the original group disbanded, I believe each member learned a lot in the process. One week our homework assignment was just to research the retirement options offered by our employers. We talked about our 401Ks, employer matches, and why it's probably wrong to put your entire 401K into your employer's stock (no diversification). Financial literacy is essential in our community, and that is one of the significant benefits of investment clubs.
Investment clubs help build financial literacy and improve money management skills, and according to the Pan African Alliance, poverty and poor money habits are transferred through generations in the Black Community for the following reasons:
The absence of healthy money management skills
Inadequate access to wealth-generating channels
An unbalanced debt to income ratio
Unrealistic hurdles to self-sufficiency
Racial inequality
and a lack of financial literacy
I recently read about the 20/20 Investment Club. It's an all-black female investment club in California who recently celebrated their 20th anniversary. Among their many successes, they were featured in Black Enterprise magazine in 2006 for their 10th anniversary, achieved a 9.4% Compounded Annual Return for the 10-year period ending 12/31/16, and as a result of the firm's ongoing education, all members have become highly proficient investors. Listen, this is what I dream about when I think about GOALS!
I believe it is vital to create a safe place for women to talk about money, their fears, hopes, and dreams in a safe place. To plan for the future and see what's possible.
I'm ready to WIN! And I hope you're ready to join me. The informational call will be hosted on Tuesday, July 21, at 7 p.m. Eastern time. Click here to email me so you can receive the Zoom information for the call.