Welcome to Day 3 of Learning to Invest with The Budgetnista & Ellevest!
New to the Beginner Investor course? Learn more about it HERE.
Did you get a chance to complete previous lessons? If not, complete them below, then come back!
Day 1: Your Intro to Investing
Today’s Focus: Understanding Your Portfolios
Today, you’ll learn..
- The components of your portfolio.
- What changes you can make to your portfolio and how those changes will affect your goals.
- What you can start to do today to take real steps toward your investment goals.
Remember, each day you’ll get a video and written lesson walking you through the process. I’ve got you!
Watch the Day 3 video below, then move on to the lesson.
Let’s meet-up later in our Dream Catcher FB Group to discuss what we learned!
See you soon…
Watched the video? Let’s get started with some do’s and don’ts.
What you DON’T need:
- To accept Ellevest’s goals and timelines as they originally show up on your account
What you DO need:
- An idea about how much you can invest right now
- Willingness to play with your plan goals, to see what a monthly deposit would look like, or a big one-time deposit of UM (Unexpected Money)
Here’s a quick RECAP of what we’ll cover today:
Step One: Goals overview
Step Two: Adjusting your targets on the Goals Planner page
Step Three: Reviewing your investment portfolio
Step Four: What else is here?
Today, I’m going to show you how to make the most of your Ellevest investment plan with what you can afford right now. Let’s log into your new investment plan on Ellevest. Ready? Let’s go…
Haven’t created your free, personalized investment plan yet? You’ll need to in order to do today’s lesson. You can do so here: https://thebudgetnistablog.com/ellevest
Don’t forget, Dream Catchers who open a new Ellevest account in September will receive $25 towards your first funded goal at Ellevest. This offer is for new clients only – see official promotional details below*
If you need help filling it out, I show you how step-by-step on Day 2, here.
*If you created a single, wealth-building goal through the “Let’s Go” button, your goal page combines several of these steps. Read through these steps for hints on how you can customize your plan, and then check out the “INVEST NOW” information below.
Step One: Goals Overview
In the picture below, you see the recommended investment for the Retirement on My Terms goal. This is a starting point for you to customize your plan.
In this picture, you see the amount of money Ellevest estimates will be available every year, at the retirement age that was selected.
Want to make a one-time deposit, or already have a monthly deposit amount in mind? Simply click the pencil link next to each amount.
If you want to change your timeline or your financial goal, simply click the edit pencil link under the retirement age and amount.
When you click either one, it will open the Goal Planner, which is where you’ll make your changes.
Step Two: The Goal Planner.
The Goal Planner is an at-a-glance look at all the goals you’ve identified. This is a great spot to play around with what’s possible today, and how you may want to contribute in the future. Remember, this is YOUR plan. Try changing the timeline, or updating the goal amount, or adding a monthly deposit that fits your investing budget. As you make changes, Ellevest will show you different suggestions to help you see all the possibilities.
At any point, if you like one of your changes and want to update your plan, click “save” – otherwise, click “back” to return to your overview without making changes.
Real talk, Dream Catcher — this part can be a little overwhelming.
I get it.
When you adjust your goals to what you can afford to invest right now, it can change your projections. You may not be on track to meet your goals just yet and seeing that can be a lot to take in.
Here’s the good news:
Life changes and, when it does (like when you get that raise, launch a side hustle or receive some unexpected money — love that UM!), you can always adjust your contributions.
If you can, commit to regular, automated, deposits for now, and then look for opportunities to increase your contributions later on.
Remember, it’s all about building a habit!
Step Three: Reviewing your portfolio
This is where you see how Ellevest would invest in your goals.
In the picture below, on the left side, you’ll see the recommended investment portfolio for your goal and timeline.
On the right side, a performance forecast shows how Ellevest projects your investment will grow over time in a variety of market scenarios.
Scroll down and you can read about Ellevest’s team, how your portfolio is customized for your goals, and how Ellevest selects and manages their clients’ investments.
Okay, scroll down again — here are the specifics. If you deposit funds toward this goal with Ellevest, this is how they would invest those funds. Every portfolio is going to be different, based on your goals, but you’ll generally see different stocks, bonds and even alternatives for some goals.
So, let’s learn a bit about these different securities.
Next to each item, you’ll see a plus sign, which you can click to expand and read more.
And if you scroll all the way to the bottom, you’ll see a link that says “Learn More About These Securities”, which you can click for even more information.
You may notice that Ellevest uses a lot of ETFs, which stands for Exchange Traded Fund. They are lower cost and more tax efficient than most securities, and Ellevest finds them to be a great match for a goals-based investing approach.
Since no one can predict the future, Ellevest builds your portfolio with a broad range of carefully selected investments which are purposefully combined to give you the potential to lower your overall risk relative to offerings from other digital advisors.
As we talked about on Day One, a diversified portfolio is a smart strategy for managing risk while giving your money the chance to grow.
Step Four: What else is here?
Let’s click back to our Goal Overview page.
On the upper left-hand side of the screen, you’ll see the word “Overview” followed by the names of each of your goals.
Now, scroll down to your first goal. Under each goal, you’ll see “Goal Advice”, “Investments” and “Settings”.
Click the down arrow next to “Investments,” and select “Overview” from this menu.
You’ll see a summary sentence that shares your estimated investing balance over time that includes the phrase “investing in an Ellevest Core Portfolio”.
Click on the pencil link to explore Ellevest’s Impact Portfolio option.
What is an Ellevest Impact portfolio?
Ellevest offers a “core” portfolio – which is a well-diversified investing portfolio designed to help you reach your goals.
Ellevest also offers an “Impact” portfolio, which invests a percentage of your money in funds that invest in companies that are working to meet higher standards for sustainability and ethical practices. The portfolio also invests in companies with more women leaders and policies that advance women, and funds that provide loans to support both women-owned businesses and companies that provide community services – child education, performing arts, housing and care for seniors and individuals in need. Wow! Right?
You can click between these funds to see how your investment allocation would compare – both portfolios are designed to help you reach your goals. If you have more than one goal, you can select a core portfolio for one and an impact portfolio for another.
Remember, it’s your plan.
Did you tell Ellevest about any outside accounts?
If you have a 401(k) with your current job or other outside investments that you shared with Ellevest when you set up your plan, you can view Ellevest’s recommended investment mix for those goals by clicking on the down arrow next to “Investments” on the horizontal menu under your retirement goal, and selecting “Outside Accounts”. Ellevest analyzes these accounts in combination with any Ellevest retirement assets to give you the best chance of retiring well.
If you haven’t added your current 401(k) plan balance yet, it’s easy to do – just click “settings” under your retirement goal, and select “Add Outside Account” from the menu.
INVEST NOW: If you created an “Invest Now” single goal plan by clicking the “Let’s Go” button, your plan has a different look, but the same opportunities to customize your goal. Here’s what you’ll see:
At the top, you’ll see an estimate of how much money you could have with the suggested deposits, timeline and portfolio. This will update as you make adjustments to your plan. Here’s what to try:
Adjust the timeline – do you need this investment in 5 years? Or 25 years?
Adjust the deposits – can you make a one-time deposit in addition to monthly deposits? What works for your budget and your goal timeline.
You can adjust the “risk” by clicking on the Risk Level box, and you can select between our core or impact portfolios as well.
To review the securities selected for your portfolio, click on the donut graph, and we’ll show you each of the investments that have been selected.
To learn more about Ellevest, you can click the FAQ links.
It’s Teacher Tiffany time aka…you know I have homework for you!
You know I am a former teacher, and I love to help you learn, so here it is:
- Explore your new Investment Plan!
Play around with different deposit amounts:
- How would investing your tax return affect one of your goals?
- How about moving your existing IRA or a 401(k) or 403(b) from an old job?
That’s it! Not so bad, right?
Tomorrow, I’m going to show you how to fund your first investing goals – and share what you need to know before you consider consolidating any outside accounts.
This is big!
See you in the a.m., DC!
PS – If you have questions about Ellevest’s investment portfolios or site features, you can always reach out to Ellevest’s concierge team – they’re happy to help: firstname.lastname@example.org.
PPS- Don’t forget to check in with your accountability partner and share how you feel about today’s lesson with your fellow DCs, here: Dream Catchers : LIVE RICHER w/The Budgetnista
Make sure to use the hashtag #DCbeginnerInvestor when you post, so me and your fellow Dream Catcher Investors can find it.
Before you go, leave a comment below.
What did you take away from today’s lesson? What new thing did you learn today? We all wanna know!
Then, share what you’ve done on Day 3 with your tweeps…With the help of The Budgetnista and @Ellevest , I understand my portfolio! #DCbeginnerinvestor Click To Tweet
© 2018 Ellevest, Inc., an SEC-registered investment adviser. All rights reserved. For information about Ellevest, and its financial advisory services, please visit the firm’s website (www.ellevest.com) or the SEC’s Investment Adviser Public Disclosure website (www.adviserinfo.sec.gov). Tiffany Aliche, known as “The Budgetnista” is a paid solicitor of Ellevest. More information about the relationship between Ellevest and The Budgetnista can be found here: https://www.ellevest.com/thebudgetnista.
*Source Ellevest. To arrive at “about $100 a day”, we compared the wealth outcomes for a woman who begins investing at age 30 with one who began investing at age 40 after having saved in a bank for 10 years. Both women begin with an $85,000 salary at age 30 and all salaries were projected using a women-specific salary curve from Morningstar Investment Management LLC, a registered investment adviser and a subsidiary of Morningstar, Inc., which includes the impact of inflation. We assume savings of 20% of salary each year. The bank savings account assumes an average annual yield of 1% and a 17% tax rate on the interest earned, with no account fees. The investment account assumes an investment with Ellevest using a low-cost diversified portfolio of ETFs beginning at 91% equity and gradually becoming more conservative during the last 20 years, settling at 56% equity by the end of the 40-year horizon. These results are determined using a Monte Carlo simulation—a forward-looking, computer-based calculation in which we run portfolios and savings rates through hundreds of different economic scenarios to determine a range of possible outcomes. The results reflect a 70% likelihood of achieving the amounts shown or better, and include the impact of Ellevest fees, inflation, and taxes on interest, dividends, and realized capital gains. We divided the calculated cost of waiting 10 years to invest, $337,657, by 3,650 (the number of days in 10 years). The resulting cost per day is about $92.50.
The information provided should not be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice.
The information provided does not take into account the specific objectives, financial situation or particular needs of any specific person.
Diversification does not ensure a profit or protect against a loss in a declining market. There is no guarantee that any particular asset allocation or a mix of funds will meet your investment objectives or provide you with a given level of income.
Forecasts or projections of investment outcomes in investment plans are estimates only, based upon numerous assumptions about future capital markets returns and economic factors. As estimates, they are imprecise and hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.
The practice of investing a fixed dollar amount on a regular basis does not ensure a profit and does not protect against loss in declining markets. It involves continuous investing regardless of fluctuating price levels. Investors should consider their ability to continue investing through periods of fluctuating market conditions.
Investing entails risk including the possible loss of principal and there is no assurance that the investment will provide positive performance over any period of time.
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