How to Start Investing in Australia: A Beginner's Guide for Women

Briony Benjamin steps in as guest host of Get Rich while Molly is on maternity leave, and she's bringing you one of our most beginner-friendly episodes yet!

This week, Briony sits down with investing expert and ETF specialist Jessica Leung to break down everything you need to know about getting started with investing no jargon, no finance-speak, just clear and practical advice for women who are ready to take control of their money.

Whether you've been putting off investing because it feels too risky, too complicated, or you think you don't have enough money to start this episode is for you.

In this episode, you'll learn:

• What investing actually is and why savings alone won't build long-term wealth
• How inflation silently eats away at your savings
• The power of compound interest (and why it really is the eighth wonder of the world)
• Why you don't need to time the market and what to do instead
• What an ETF is and why it's a great option for beginner investors
• The biggest investing myths holding women back from getting started
• What a beginner portfolio could look like
• How to choose a brokerage platform and what fees to watch out for
• How ethical and sustainable investing works inside an ETF
• The most common beginner mistakes (and how to avoid them)

The biggest takeaway from this episode? Just start. You don't need thousands of dollars or a finance degree you just need to take the first step.

🎧 Perfect for: women who are new to investing, anyone curious about ETFs, and anyone who's been waiting for the "right time" to start building wealth.

CHAPTERS

00:00 – Welcome to Get Rich Podcast
00:29 – Molly’s personal money story and mission of the podcast
01:16 – Introduction to guest Jessica Long
02:19 – What is investing? Simplified explanation
03:02 – Why saving alone isn’t enough
04:03 – Understanding risk, inflation and personal goals
07:04 – The concept of compound interest
08:04 – Market timing vs. time in the market
08:24 – When is the right time to start investing?
09:52 – Myths that stop beginners from investing
11:35 – Jessica’s origin story in investing
12:44 – Getting started: Step zero essentials (emergency fund, debt, budget)
14:40 – What is an ETF? Simplified explanation
16:19 – Diversification and why it matters
17:23 – Individual shares vs ETFs
18:50 – Why boring investing can be powerful
20:18 – Choosing a broker and platform
23:00 – How much money you need to start investing
24:05 – Building a beginner portfolio
24:53 – Investing ethically with ETFs
26:16 – Common beginner mistakes
27:18 – Dividends and ETF distributions
28:40 – Reinvesting dividends (DRP explained)
30:16 – Advice to my 25-year-old self
30:42 – Final thoughts: Just start investing 
   

LINKS FROM THE EPISODE

Global X ETFs: https://www.globalxetfs.com/
ASX - Australian Securities Exchange: https://www.asx.com.au/
S&P 500 ETF information: https://www.globalxetfs.com.au/funds/zyus/
 

CONNECT WITH JESSICA LEUNG

Website: https://www.globalxetfs.com.au/
LinkedIn: https://www.linkedin.com/in/jessica-sy-leung/
Instagram: https://www.instagram.com/theleungway/
TikTok: https://www.tiktok.com/@theleungway
YouTube: https://www.youtube.com/@theleungway

CONNECT WITH LADIES FINANCE CLUB

Join our free Facebook group - Ladies Finance Club Money Chat
Website: https://www.ladiesfinanceclub.com/
Instagram: https://www.instagram.com/ladiesfinanceclub/
LinkedIn: https://www.linkedin.com/company/ladies-finance-club/

TAKEAWAYS

•  Basics of investing and why it matters
• The importance of saving and investing together
• Understanding risk and personal investment goals
• The magic of compound interest and long-term growth
• Diversification and ETFs as a safe investment strategy
• Common myths and mistakes in investing
• How to start investing with small amounts
• Choosing the right broker and platform for beginners

SOUND BITES

"Inflation can eat away at your savings"
"ETFs are like a party mix of securities"
"Don't check your portfolio too often"

TRANSCRIPT

[00:00:00] Molly: Welcome to Get Rich, the podcast that helps you do just that. Get rich and stay rich. Hey, I'm Molly Benjamin. I'm the founder of Ladies Finance Club, one of Australia's largest financial education platforms for women. But before I started helping thousands of women take control with their money, I was a hot financial mess when it came to my own finances and not the fun kind of hot, more like crying in a supermarket, wondering where all my money went kind of hot.

[00:00:29] But here's the thing, if I can go from financial mess to owning a share portfolio, investing in property, and building wealth. Then you can too. My mission is simple to make women rich because when we have financial freedom, we have choices, confidence, and control over our future. Every week on Get Rich, I sit down with some of the best experts in the industry to break down how we can all start investing, growing our money, and creating long-term financial security without the jargon, boring bits or overwhelm.

[00:01:02] Because when women get rich, we don't just change our lives. We change the world. So if you're ready to start making some smart money moves, hit that subscribe button and let's get rich together.

[00:01:16] Hey everyone, it's Briny Benjamin here. I'm Molly's big sister and I'm filling in for Molly while she's off in newborn land. So today we're talking investing. Without the jargon, without the fear, and I'm gonna be joined by the brilliant Jessica Long. She's an ETF portfolio manager and the creator of The Long Way you can follow along on Instagram.

[00:01:36] She's all about making investing simple and accessible, which was what Ladies Finance Club is all about. We cover what investing actually. Why saving a loan isn't enough, how compounding works and how to get started even with small amounts, plus ETFs, diversification, ethical investing, and the biggest beginner mistakes to avoid.

[00:01:58] If you've been thinking, I should really start investing, this is your sign. Let's get into it. Well, we are pumped to have Jessica Long on the line today to teach us everything we need to know about investing. Jess, you are the guru and I'm so excited to have this chat with you. So thanks for making the time.

[00:02:17] Jessica: Thanks for having me. I'm so excited to be here.

[00:02:19] Molly: So just to get straight into it, just nice and simple. No jargon, no financey speak, that people often get stuck in what is investing.

[00:02:29] Jessica: Yeah. So to put, very simply, investing is putting your money to work so that you can grow over time. So instead of money just sitting in your bank account kind of earning interest, investing puts your money to work by giving you exposure to things that can potentially increase in value over the long term.

[00:02:45] So for example, like shares, companies, properties, or bonds. And remember, the goal isn't to get rich overnight when it comes to investing. It's to build wealth steadily and sustainably over the long term.

[00:02:57] Molly: Well, that sounds pretty good to me. I don't want my dollars sitting around being lazy in the bank account.

[00:03:02] So I love that, that idea that it's. Actually putting them to work and just why? Why is that important though? Why aren't savings alone enough?

[00:03:10] Jessica: Don't get me wrong, saving is super important, and that's always the first step that we tell people when they're starting investing you to always save up an emergency fund.

[00:03:19] But saving gives you safety and flexibility. But the reality is, unfortunately, is that saving alone usually isn't enough to build long-term wealth. And why is that? It's cost of living, right? So everything keeps going up. And then so that the interest rate you earn might not necessarily. Be as much as the rate at which cost of living is going up so it can't keep up.

[00:03:41] So investing gives your money the chance and the potential to grow faster than inflation over time. And investing is really what gets you from, you know, just getting by. You're saving your hard earned dollars into your savings account, and you see it slowly increasing over time versus actually building financial freedom.

[00:03:58] And long-term wealth. So both saving and investing matter. They just often serve different purposes. And I think since we're talking about investing, we have to talk about risk as it's, you know, two sides of the same coin. So you can make money by investing, but on the flip side, you can also lose money. By investing.

[00:04:16] So, which is why we often, it's so important and we often talk about understanding your personal investment goals. So what is it that you want to achieve from your investments and also your risk profile. So how much risk can you take on and how much risk do you want to take on? And then choose your investments accordingly.

[00:04:33] So that's why, you know, when you say. Well, then you're probably thinking, why shouldn't I just save if there's risk? Well, saving isn't exactly risk-free when it comes to thinking about it. In terms of building your long-term wealth, I like to think of it as risk and return lie on a spectrum. So saving is on the very far end where it's highly unlikely that you'll lose.

[00:04:52] Money. So it's very low risk, but then at the same time, the rate of return is more on the lower side and it's often not enough to keep up with inflation. So that's why you need to consider investing alongside saving.

[00:05:03] Molly: Right. Okay. So if the money's just sitting there in your bank, it's pretty safe on the spectrum, as you said, but it's actually due to inflation, as you were saying?

[00:05:13] Yes. Sort of like it's almost getting eaten away. Like you're almost going a bit backwards, would you say?

[00:05:17] Jessica: Exactly. So let's just say inflation has been like seven, 6% while your interest on your saving accounts really 5%. So even though you're earning the 5% every single year, you're still essentially losing off that 2% because the rate at which prices and the cost of living is increasing is just higher.

[00:05:35] Molly: Yeah. Right. So, okay. That makes it really clear as to why investing is so important, that, as you say, people might like the safety of having the savings there, and you're saying that's good to have in the mix. So how do we move people beyond, I suppose that fear mindset of, I'm just, I'm just scared of investing.

[00:05:52] I don't know where to sort of. Begin, what do you say to people?

[00:05:54] Jessica: Yeah, so that's why, um, we always go back, like I mentioned, to understanding personal finance is personal, right? So it's really asking yourself those deep down questions on what is it that you want to achieve over the long term? Do you wanna buy a house or do you wanna build your nest egg or do you wanna save for a holiday or do you wanna do it all?

[00:06:12] And there's absolutely nothing wrong with that, right? But it's just getting very clear with yourself in terms of what you want to achieve and in what. Time horizon. 'cause that will help determine what type of investments you have. And then understanding, well, how much money can I afford to invest every single month or whenever you get your paycheck.

[00:06:29] And then also understanding what's the appropriate risk profile for me. So how much risk can I afford to take on? So then for. For example, if I wanna save up for a house one day, is it just enough to put it in my savings account? Or on the flip side, should I put it into something really risky? For example, you know, like crypto futures leverage or that kind of stuff.

[00:06:49] Is that the best choice for that specific goal? So then after you kinda ask yourself those questions, it helps take the emotion. Out of it a bit. Mm. And then you get more comfort in knowing that you are doing something which is risk adjusted and which is helping you achieve your long-term goals.

[00:07:04] Molly: Okay, fantastic.

[00:07:06] Jess, I often hear this term about compound interest and that it's eighth wonder of the world people think. Yes. And how, and can you just give our listeners an example of. Yeah. How that works in actuality.

[00:07:21] Jessica: Yeah. So compounding in essence is where your money starts to earn money on top of the money. It's already kind of earned.

[00:07:28] So there's a lot of on top, on top on top. So it, to visualize it, think of it like the snowball, you know, rolling down the hill. At first it starts very small, but then through time as a compound, it gathers more and more. And then through that gathering then. Keep getting more traction. So that is what compounding.

[00:07:45] So at the beginning it might feel slow, almost boring at times because you don't really see much action happening. But over time the gains really start building on themselves, and that's really when the real magic and the acceleration happens. So that's why in investing we say it's not about timing the market, it's about time in the market.

[00:08:04] So the longer your money is invested, the more powerful. Compounding becomes, and then that's why we call it the eighth one though of the world.

[00:08:11] Molly: Okay. I love that. Thinking of my money as a giant snowball, just rolling on down the hill.

[00:08:16] Jessica: The best thing is at the end you don't need to do anything, right.

[00:08:19] You're just watching it falling and it just keeps compounding and growing and that's why it's so magical.

[00:08:24] Molly: Okay, fantastic. And you said a really interesting line there about it's not timing the market, it's time in the market. So I know for me, I was actually bought a bunch of shares when I was in. High school, you know, and you didn't have as many bills as, uh, maybe I have now, and I've sort of sat there ever since and it's been on my to-do list, to buy more shares to do it.

[00:08:45] But there's often those, oh, things are crazy in the world right now. Or the economy feels unstable, or, you know, and so you are trying to wait for that moment. Yeah. What would you say to people, beginners, that are thinking, I wanna get started, but it's just not the right time. How do I know when that right time?

[00:09:01] Jessica: Yeah, so there, I would say there never is a right time. You know, as the saying goes, the best time was probably yesterday or 10, 15 years ago, but the second best time is right now. So I think once you've kind of got the foundations right in terms of you've got your emergency fund set up, you've paid off your high interest debt, you've done your budget, you know how much you can actually afford to invest.

[00:09:19] So making sure you're investing with funds that you don't need straight away or over the short to medium time horizon and. Now is as great a time as ever to start investing. And then that's why I always come back to what is your goal? What is your investment plan? Because then that helps take the emotion out of everything.

[00:09:37] And then there's been lots of research and studies shown that just by missing the best 10 days of performance, that will have a substantial impact on your portfolio over the long term, as opposed to you just staying invested and going for the ride for the long term.

[00:09:52] Molly: Yeah. Fantastic. And Jess, what for, for people that are beginning out in their investing journey, what are some of the biggest myths that you think stop people from even getting started on that journey?

[00:10:04] Jessica: Yeah, so one of the top ones that are always here is that, oh, investing is really risky, is practically just gambling. Well that, to that I would say like if you are a high frequency trader of your. Speculating, that's what gambling is, right? But if you're investing for the long term appropriate to your risk profile in a diversified portfolio, then that is investing for the long term, and that's not gambling.

[00:10:27] And the second one is, I'll start when I have more money. And that's what keep people stuck for years. But like we mentioned with compounding, it's you just gotta start and take small steps and then once you start consistently taking those steps, then compounding and the rest will work itself out to help build your wealth over the long term.

[00:10:46] And last one. So this one's a bit cheeky. I'm not sure if I should share it, but often when I talk with like my girlfriends and whatnot, they always just say, oh, I'll just let my partner handle the finances. You know, he's the one that invested. And to that I always say. A man is not a plan or it doesn't matter.

[00:11:02] A man or woman is not a plan, right? Yes. It's like so, so that's why I find financial literacy really empowering 'cause it gives you financial independence, confidence, and freedom. And I mean, who doesn't want that? At the end of the day, it's your hard earned money. So that's personally why I started my social media to help, you know, educate on all things investing and ETFs.

[00:11:24] And that's also why I'm such a big fan and advocate of communities like yourself, ladies Finance Club, to help break down the barriers and jargon and to actually, well, how do you start investing in a practical manner?

[00:11:35] Molly: And I was actually wondering that Jess, where did you first get interested in the world of investing?

[00:11:40] I mean at what age were you like, this sounds like a good thing I should be across.

[00:11:45] Jessica: So my kind of origin story started when I was really young. My first memory of investing kind of goes back to year three and that was when we had a, a substitute teacher and she came in, said, this is showing my age now.

[00:11:56] But then she gave us all photocopies of the newspaper. 'cause back then, that's where all the share prices would get printed. You know, we didn't have mobile, mobile phones. Dating live prices. So we just got this massive photocopy of all the stocks on the A SX, and we were given this mini assignment going, okay, you have $10,000 to invest, how would you invest it?

[00:12:15] So then we kind of went through the whole exercise of choosing our own stocks and how to pay for portfolio, and then we would track it throughout time. So that was my first ever memory when it comes to investing.

[00:12:25] Molly: What a wonderful way to get started. And I remember doing a very similar thing with my mom and dad.

[00:12:29] Like highlighting the A SX numbers and going through it and getting your head around it and what a gift at that age to get across it. So, sounds like a great substitute. Um, lesson had the head got you started. Yeah. I mean, to

[00:12:42] Jessica: her, so,

[00:12:44] Molly: so Jess, if someone's never invested before, where do you start? What's step one?

[00:12:48] Jessica: So step one is actually step zero, and it's actually got nothing to do with investing. Like I've mentioned before, it's really about getting your foundations right. So that's why I call it step zero. And what that means is make sure you have an emergency fund saved up. So that would be three to six months of your usual living expenses or depending a bit more depending on your personal circumstances, just in case if anything touch wood happens, you do have that emergency fund to fall back on.

[00:13:13] Pay down any high interest debt. And then budget. So like I mentioned before, it's very important that you only invest with the funds that you can afford to invest with. So even if that means after you're doing your budget, you've allocated all your different money and you only have, let's say, even 50 or a hundred dollars to start, that's more than enough because there's lots of, uh, micro investing apps.

[00:13:35] So that's where I would plan on starting.

[00:13:37] Molly: Okay, fantastic. So I know Molly always calls it at Ladies Finance Club, an OMG Fund. So have your OMG funds sorted for those OMG moments of life. Pay down any bad debt, sort your budget and then, but don't be afraid to start small. It doesn't matter if you don't have thousands of dollars to invest.

[00:13:55] You can start, as you said, with. With a very small amount,

[00:13:59] Jessica: and I think it's better to start small because imagine if you go all in on day one, and then like we said, there's volatility, there's risk. It's not always up, up, up. It's like up, down, up, down. But investing over the long term tends to be up. So then imagine if you just put your life savings in on day one.

[00:14:14] This is your first time investing, and then you see the stock market goes down 2% the next day. Like that would be a quite traumatic and horrific experience. So if anything, I always believe in, like you learn more on the job. As opposed to just reading on textbook. And so that's why you start small, get in the process of investing, getting familiar with it, and then so that by the time you act, your savings and your investing grows to a substantial amount.

[00:14:37] You're very familiar and confident with the whole investing process.

[00:14:40] Molly: Okay, fantastic. That sounds like my style of investing for sure. And Jess, this term is bandied around in investing land and ETF, but what actually is it? Can you just break it down really simply?

[00:14:53] Jessica: Sure. So ETF stands for Exchange Traded fund, and how I like to break it down is actually backwards.

[00:15:00] So it is a fund, which is essentially just a pool of money gathered from all the investors into one that is traded on the exchange. So on the exchange being the A SX. So my analogy of how I like to think about an ETF is the party mix of security. So I know Molly likes to use the favorite box of chocolates, but I'm more of a sugar and a lolly girl compared to a chocolate girl.

[00:15:22] So I always do the party mix, you know, the Allen's red bag or party mix. So. In within the one bag, it gives you exposure potentially to hundreds of companies, an entire stock market or a specific theme. So taking our A 300 or the Australia 300 ETF as an example. So within that one ETF, it gives you exposure to the largest 300 companies listed on the A SX.

[00:15:46] So in instead of you individually going to buy a red fog, so like. BHP and then you know, the snakes CB, A and NAB and Westpac and so on. To curate your own kind of basket of securities, you can get exposure to all the 300 companies within the one product.

[00:16:02] Molly: Fantastic. Well, I'm craving some red frogs now.

[00:16:04] Thanks for that, Jess, but, but a great way of thinking about it. So you don't wanna overdose on red frogs, and like you said, they could be pretty volatile, but you get a. Bit of everything and, and therefore, it's like a safer way to invest, I suppose. And that diversification, why is it so important? I mean, you touched on it, but can you go Yeah.

[00:16:24] Go into that in a little more depth?

[00:16:26] Jessica: Of course. So the benefits of diversification, as the saying goes, is to not put. All your eggs within one basket. So when you spread your money across different investments, across different names, you reduce the impact of any one single investment doing poorly. So let's just say you had everything in CBA and C.

[00:16:45] BA was down 5%, then your whole stock portfolio was down. But if it was spread across hundreds of different names and each of them had separate performances, and you get a much more balanced, diversified return when it comes to your portfolio. So, but I do have to say it doesn't totally. Eliminate the risks altogether because there's no such thing as a free launch.

[00:17:03] It just helps smooth the journey along the way. And because investing, we can't control the markets or their performance, but what we can control is how concentrated or diversified we are.

[00:17:14] Molly: Okay, fantastic. And, and so any other pros and cons for us of, um, buying individual shares versus that ETF?

[00:17:23] Jessica: Yeah, so then like we have already mentioned, so within the main benefits of an ETF is that you get diversification, so you get that access to the whole lolly bag of securities within the one product.

[00:17:35] Another benefit is that you can buy in or out of it, just like you would any share on the sx, and that is usually on the hours of 10 to four, Monday to Friday. There are also low cost. So what we mean by low cost is. Taking that a 300 ETF as an example. So a 300 is the Ticketer code. Imagine you having to to buy each of the 300 names individually.

[00:17:59] So you have to buy brokerage. That means you have to spend brokerage on 300 names and then try to combine everything. Whereas in this one, you just. Buy, you just have to pay the one set of brokerage because you're just buying that one product, which gives you exposure to the whole 300 names. Other ones is, like I mentioned, ease of trading.

[00:18:16] So just like you would've share, and then transparency. So as a passive ETF issuer, we have to list all our holdings on our website every single day. So you can have a lot of comfort in knowing that every time you log onto our website, you know exactly what your ETF is holding.

[00:18:32] Molly: Fantastic. I suppose for some people it might not be quite as exciting buying an ETF.

[00:18:38] It might be a bit more boring than being, I've bought, you know, shares in this crazy cool new startup. I, I know you often hear really experienced investors say, boring is beautiful. Boring is great. Why is that the case?

[00:18:50] Jessica: Yeah. So when it comes to investing, it all really depends on your personal. Preferences.

[00:18:54] So I remember kind of going back to year three or then when I started actually investing with my own money as I was younger, but not as young as when I was in year three. I used to be, you know, very hardcore in terms of I wanna be a stock picker. But what does that mean when you invest in shares versus an ETF?

[00:19:10] Is that it's a, it's a lot. More concentrated 'cause it's everything is in that one name and often requires so much more work in terms of research and and whatnot. And you know, like adulting is hard. Like as of now, I can barely have my life together, do my budget, do the laundry, let alone thinking about what stocks to consistently invest in.

[00:19:30] So that's why for me, there's a lot less mental load when it comes to investing by a diversified ETF. And I just find that approach works for me the best.

[00:19:39] Molly: Okay, fantastic. Well, I know that at the moment, at this point in my life with two small babies and all the things going on, it just feels like one more thing to do.

[00:19:49] So to be able to simplify it exactly and

[00:19:52] Jessica: make it make it easy is very high up on my list of things I'm looking for. That's for sure. And now I even just set and forgets every time that. The money comes in from the paycheck. It's kind of a bit towards the, we're saving for a house right now, so a bit for a house deposit, and then it's always paying myself first, so savings and then emergency fund top up if needed, and then just automatic investment every single time.

[00:20:13] So it's like a set and forget. That's the most straightforward way to build wealth over the long term.

[00:20:18] Molly: Fantastic. So that idea, I love that idea of just chipping away and putting a bit away each, you know, week or fortnightly. Do you have a particular cadence that you suggest in terms of. Brokerage fees, like how does that work?

[00:20:31] What are the most sort of cost effective ways to do it, I suppose?

[00:20:34] Jessica: Yeah, so that one, it depends on A, or a, most importantly, how often you get paid. And then B, in terms of, so each brokerage platform is different, so that's why it's really important to know exactly what the fees are involved. So for example, some set a, a flat rate of $10 or some take a percentage cut.

[00:20:53] So let's just say like half a percent of the amount you're investing. So if your brokerage platform does just charge a flat fee of $10, then it probably wouldn't be, uh, the smartest choice to invest $20 if it's going to invest, if it's gonna take 20. So that's why it just really depends, but. To what? That I would say is a first, work out your budget, work out your cash flow and how much you can afford and how often you can invest and based on that money, try to find a brokerage platform or one, where's the fees most aligned Best with that.

[00:21:23] Molly: Perfect. That sounds great. So, okay, thinking about the goal, how much you wanna invest and linking it to when you get paid and when it's gonna make sense to, like you said, pay yourself first, but get it done. So it's. All automated. Wow. Sounds like a, a wonderful way to do it. And in terms of what other things beginners should look for when choosing a broker.

[00:21:44] So we've talked about fees. I know there are any other considerations to think of.

[00:21:48] Jessica: So I'm very time poor or like, I don't like. To spend a lot of time trying to figure out how to use this app and whatnot. So ease of use is actually very, very important on my list, on my personal list when it comes to a brokerage platform.

[00:22:01] So in terms of how does the app actually look and feel, is it very user intuitive because, and does it have options for you to help automate. Your savings and your investing. So that's probably the key things that I look for, because for me it's about making the whole process as simple as possible so that there's just less, um, room to think about in terms of.

[00:22:23] Making emotional choices or poor choices. Uh, that's why I just kind of make it as routine as possible. And then another thing which I personally look for or I really like is when a brokerage platform has good educational resources. So they might give you like tips in terms of how to best dollar cost average into the market.

[00:22:41] What's happening in the, in the market as of now, and what are some investing strategies like? That's the stuff that I look for.

[00:22:47] Molly: You are speaking my language, Jessica, I, I wish, um, I'd spoken to you about 20 years ago, but like you said, the best time to get started if it wasn't 10 years ago, is today. So I'm gonna go and, uh, jump straight on this after this call.

[00:23:00] This is fantastic. And on that note, how much money do you realistically need to start? You know, is $500 enough or is that too much? What do you need?

[00:23:10] Jessica: Well, the short answer to that is actually much, much less than most people think. So in Australia you can start investing with as little as, I think you can even start investing with $50 with some micro investing apps.

[00:23:23] So the amount really starts there, or even as little as a few hundred dollars. So it really depends on the platform. So on the brokerage platform and whether they allow fractional investing and what the minimum investing is. But really to that, it's. Whatever amount you can afford to invest in. So what matters more than the starting amount, I think over the long term really is consistency.

[00:23:44] So are you topping up on a, being consistent and disciplined, and of course time in the market. So what I always like to tell beginners is that you don't need to start big. You just need to take the first step and start investing.

[00:23:58] Molly: Fantastic. And in terms of that beginning step as well, then. What would a good beginner portfolio look like?

[00:24:05] I know obviously it's linked to your own personal risk, as we've discussed, and it's personal, but yeah, some guidance on that.

[00:24:12] Jessica: So some areas for beginner to start looking at is we often say a broad base in the sea. So for example. ETFs that give you exposure to whole share market. So for example, the A SX or the US or s and p 500, uh, the top US 100 companies or Yeah, like the A 300, like we've, uh, mentioned before.

[00:24:33] So those are all good areas to start doing your research because it gives you broad exposure and like we said, being broad, it helps mitigate the concentration risk and it just gives you. Uh, broad index exposure.

[00:24:45] Molly: Yeah. Fantastic. And more a personal question on this front too. I know that for my husband and I, ethical investing is really important in that mix.

[00:24:53] Um, that's something that you can also do with an ETF, though, I believe.

[00:24:56] Jessica: Yeah, it is. And so the top tip I would give when it comes to not just ethical, but any type of investing is a look under the hood. So what we mean by that is actually go onto the ETF issuers website and have a look on the actual fund webpage.

[00:25:11] So for example, let's go back to a 300. So you go to globalx. etfs.com au and then you type in a 300 and you actually understand the index methodology or how it comes to build the fund. So A SX is just the largest 300 companies listed on the As SX, but in terms of, for example, the ethical fund is what do they actually consider as ethical?

[00:25:32] Um, how are they actually implementing it in your portfolio? Are they doing negative screens? So that is, are they just not investing in certain companies or they're trying to achieve certain goals? Uh, so that's probably the best tip when it comes to like understanding what. The ETF is actually doing is to look under the hood.

[00:25:48] Molly: Okay. That's fantastic. So for me, for example, climate change is really important. So I want, I wanna invest in, I suppose, funds that are not in fossil fuels, but an ethical fund that might not be aligned with that, I suppose. So it depends on the makeup. Yeah, so, and getting alignment very

[00:26:02] Jessica: broad, while some are more niche.

[00:26:04] So that's why it's very important to make sure that the one you are choosing aligns with everything that you want, or everything that you're expecting from the fund.

[00:26:12] Molly: Okay, Jess, I'm wondering if there's a beginner's mistake that you see all the time.

[00:26:16] Jessica: Yeah, so the first one or the top one, and I'm so guilty of this every now and then, is.

[00:26:22] Checking your portfolio too much. 'cause like we said, you are investing for the long term. So does really the price move of like a day or a week really matter when it comes, when we're talking total span of like decades here. Right. So of, and especially now when there's so much going on in the world and then there's so much market movements and volatility, it is very tempting to just kind of get.

[00:26:42] In the hype of, oh, constantly checking, oh, my portfolio is up 5%, yay. And then like, oh, it's down 5%. And then that's how you start to get emotional and maybe make decisions based on emotions and not your actual investing goals. So that's the top mistake that I, I always see, which I'm so guilty of myself. So it does take a lot of time and discipline.

[00:27:01] I'm just, I'm just being very clear.

[00:27:03] Molly: Well, that makes me feel really good, Jess. 'cause it turns out being a bit of a Slack investor once it's set up is okay in your books. Yeah,

[00:27:10] Jessica: for sure. That

[00:27:10] Molly: you don't need.

[00:27:11] Jessica: Set and forget, put it in the drawer and then come back 30 years time. That's probably one of the best approaches there is

[00:27:17] Molly: set and forget.

[00:27:18] And Jess, another question just with ETFs. I know that obviously a normal share might pay a dividend. Do ETFs pay a dividend as well or is it different?

[00:27:26] Jessica: Yeah, so ETFs, we call that a distribution and what, how the mechanics of that work in A ETF is that, for example, going back to a 300, we have 300 companies and not all the three kind of hundred companies pay a dividend, but even if they do, they don't pay it on the same day.

[00:27:42] So how are ETF distribution works? Is that, you can check this on the fun page is I usually. Pays it out either quarterly or semi-annually. So we just set a set date. So going every quarter or every June 30, what we're going to do is we're gonna collate all the dividends that the underlying shares have been paying throughout this time period, and then redistribute it back to you as the investor.

[00:28:06] Molly: Fascinating. And so when you go to invest in a fund, will it, could it give you an estimation of what that might look like? Or is it always gonna be different? How do you know? Yeah,

[00:28:15] Jessica: so we can't, uh, project, oh, I mean, you can project, but it's never guaranteed that even though a, a fund or a stock has paid, let's say X dollars before that, you'll keep continuing paying X, but the fund webpage will always show you what previous distributions have been.

[00:28:31] Molly: Great. Is it a case that, like a normal share, you can get that back in shares or in cash, or is it one or the other?

[00:28:40] Jessica: Yeah. So then with ETF, there's an additional kind of structure or Yeah, structure to it in the sense that when you buy an ETF or invest in an ETF, you can elect to whether have your DPS reinvested for you.

[00:28:54] So that is a. Dividend or distribution reinvestment plan. So once you tick that box, when you do invest in an ETF, what that means is that the ETF issuer or myself, that would actually reinvest the dividends that the ETF gives back to you. So let's just give a very simple example. Let's say a 300 pays a distribution.

[00:29:15] $10 in cash. So there's two options for you then. So you can either receive the $10 in cash in your brokerage account so that you can either withdraw the cash or reinvest it yourself. Or if you've elected for DRP, then what that means, that is me as the ET TF issuer is an I will go and invest the $10.

[00:29:34] Back into the fund for you. So there's pros and cons to, to both. But then the main pro is that there's cost savings and you don't need to worry. And then I do the reinvesting back for you as a ETF issuer.

[00:29:45] Molly: Okay, great. So just to summarize that, if you're listening and, 'cause this is in the weeds of, of how it works, but basically you can get a dividend back with a fund like you would with some shares.

[00:29:57] You could get that in cash that you off, you go take it, use it however you wish, or it could get reinvested into more. Back into the fund for you under your correct allocation. Okay? Yes. Fantastic. Well, Jess, I've got one final question to finish today with. If you could go back to your 25-year-old self, what would you tell her?

[00:30:16] Jessica: Tell her just to start investing and then don't worry about, you know, buying all those outfits that you're only gonna wear once and forget about. Just imagine all the money that you could have sitting in your brokerage account 10 years from then when it's through compoundings. It doesn't take much to begin with, so it might just be $50 here and there, but all that adds up over the long term and to my 25 year or so, if I would say, yeah, just start.

[00:30:42] Molly: Just start. What a great note to finish on. Jess, thank you so much for your time and sharing your incredible expertise with. The Wonderful Ladies Finance Club community, and yeah, that's gonna be my biggest takeaway today. Just start, start small. Just start,

[00:30:57] Jessica: start small and stay consistent. It's not about being perfect, it's just about taking the first step.

[00:31:02] Molly: Thanks so much, Jess, and happy investing if you're out there getting started.

[00:31:06] Jessica: Thanks for having me. Happy investing.

KEYWORDS

investing, ETFs, wealth building, risk management, compound interest, beginner investing, diversification, financial independence