Women, Invest in Yourself

Morningstar's Christine Benz tells women to match investment risk to their longer life expectancy.

Photo of Christine Benz
Growing up in a family of six girls, Morningstar's Christine Benz felt no limitations on what she could or couldn't do.
(Image credit: Courtesy of Morningstar)

As director of personal finance for Morningstar, the giant financial research firm, Christine Benz dispenses financial advice to all the firm’s clients. Kiplinger's editor-at-large Janet Bodnar spoke with Benz about her perspective in her job and what advice she would offer to women in particular. Here's an excerpt of that interview.

You recently tweeted that one of your favorite books on investing is Burton Malkiel’s A Random Walk Down Wall Street. Why? It was the top book on my reading list when I started at Morningstar as part of the copy-editing team. I thought it was incredibly well written and even playful, not something I expected from an investing book.

How did you advance from your start on the copy-editing team? Morningstar has a great culture and is very much a meritocracy, and from my earliest days as an analyst I was always getting pushed to do things beyond my comfort level. Morningstar managing director Don Phillips was a great role model.

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Did anything in your background prepare you for working in the financial field? I come from a family of six girls, and that has always shaped my worldview. There were no boundaries about what I could and couldn’t do. My dad played basketball and tennis with me, taught me about investing in the market. I never thought about boys doing this and girls doing that.

Does being a woman bring a different perspective to your job? It makes me conscious that women tend to have more caregiving obligations. I’m not a mom, but I have a sister with an intellectual disability who lives with my husband and me for part of every year, so caring for her is a big part of my life.

What advice would you give to women in similar situations? When caregiving obligations arise, make sure you understand the implications for your own retirement plans. Many of my friends have cut back at work or become full-time moms. They’ve thought about how this works out for their budget now, but less about implications down the line. For example, they should take advantage of spousal IRAs so they can continue to save for their own retirement, which could last for 30 years.

What have you learned about women and the way they invest? I used to accept the wisdom that women tend to be more conservative investors than men, but now I believe the data show that it depends on a woman’s income. Women within the same income bands as men tend to adhere to pretty similar behavior as far as investing is concerned. Women in general are more likely to ask for help, using such things as target-date funds or managed accounts.

Is that a good thing? Potentially, yes. But women need to be discerning. Some women take the idea of delegating their financial affairs too literally. You need to do your due diligence.

How should investors be coping with low interest rates? Retirees in particular need to be very careful to look at total return instead of just yield, and be willing to sell appreciated securities, because an income portfolio is not going to cut it. Take a step back and construct the most sensible portfolio you can. For many retirees, a baseline allocation of 50% to stocks makes sense.

What’s your best advice for women? Maximize your human capital. Invest in your education, be thoughtful about your career, be assertive in asking for more money. My best investment advice is to match your risk to your longer life expectancy. With such low interest rates, you can’t afford to be too conservative.

Janet Bodnar

Janet Bodnar is editor-at-large of Kiplinger's Personal Finance, a position she assumed after retiring as editor of the magazine after eight years at the helm. She is a nationally recognized expert on the subjects of women and money, children's and family finances, and financial literacy. She is the author of two books, Money Smart Women and Raising Money Smart Kids. As editor-at-large, she writes two popular columns for Kiplinger, "Money Smart Women" and "Living in Retirement." Bodnar is a graduate of St. Bonaventure University and is a member of its Board of Trustees. She received her master's degree from Columbia University, where she was also a Knight-Bagehot Fellow in Business and Economics Journalism.