3 Investments Women Should Make in Their 40s, According to Financial Expert Tiffany Aliche

Over the hill? Women in their 40s are not. In fact, I’d say we’re actually hitting our stride, which feels awesome…minus the fact that it’s also the decade when everything tends to get more expensive all at once. Raising young children, aging parents, career pivots, retirement anxiety—it’s a lot. It can be tricky to know how (and what) to prioritize, especially when it comes to protecting your future self. That’s why we turned to Tiffany Aliche, founder of The Budgetnista and author of Made Whole: The Practical Guide to Reaching Your Financial Goals, to get her advice on the best investments to make in this decade, plus one she’d absolutely avoid.

Bottom line: The more you know yourself, the better you can optimize for that. “Your goal should always be to create an environment where you thrive—and therapy is the gateway to that,” Aliche says. For example, in Aliche’s case, therapy taught her that she’s a very good people person, but not the most organized. As she launched her business, that was a challenge because she felt like she had to wear all the hats. Therapy helped her uncover her strengths and weaknesses and what made her feel stressed vs. not, which led her to take steps to outsource the areas where she didn’t naturally excel. “I told my team: If you can free up my day to not have to do the mundane behind-the-scenes, I will keep bringing home the contracts. That was a huge breakthrough,” Aliche explains. In other words, really good therapy has an upfront cost, but one that pays off personally and professionally, too. “It’s a mirror that holds you accountable,” she adds.

In your 20s and 30s, your disability insurance is yoga—and that feels like enough of a plan when it comes to your health, Aliche jokes. But in your 40s, it’s critical that you start taking steps to protect what you’ve built, not just your assets, but your future, too. “Do you have disability insurance? Is your life insurance offering enough coverage to really match what life looks like now? What adjustments do you need to make? These are all questions to ask,” Aliche explains. Maybe you set some of this up in your 20s—If you do have some of this already in place, it’s important to drill down on more of the nitty gritty: Will your life insurance help cover your funeral expenses? What does your estate plan look like? Are your beneficiaries up to date? In your 40s, it’s about the cash reserves, yes. But it’s also about future-protecting yourself and what you’ve earned, Aliche says.

“I’m a firm believer that money is a team sport,” Aliche explains. “But you have to really ask yourself, especially in your 40s, who do I need on my team? Who is my accountability partner?” Per Aliche, that could be your mom, your bestie, your husband or your wife, but—especially if you have a home or a kid—an accountant is key. “Maybe you want to look into how you’re paying taxes and ways to minimize your tax burden. Or your insurance policy needs to be adjusted. Budgeting for this, even if you only meet once a year, is incredibly worth it,” she says. Also, a lot of times, a once-a-year meeting is a fairly nominal fee. (Aliche says allocating around $600 to this should be plenty.)

We all want to save for a rainy day, says Aliche, but if that means that you are overly padding your savings vs. living your life now, that’s problematic. “You want to be smart—but being ultra-conservative is unnecessary. You want to enjoy the fruits of your labor, too.” As a chronic over-saver herself, Aliche recommends having at least six months’ worth of savings in the bank in order to cover your basic overhead of monthly expenses. “If you’re an entrepreneur, like me, you could add a little extra. Aim to save a year’s worth of expenses in that case if you can,” she says. But that’s the limit, according to Aliche. “At one point, I had almost three years of emergency savings in a high-yield savings account. That’s too excessive. I should have been investing that money for higher growth or simply enjoyment,” she reflects. It’s good to be responsible, but if you reach your 80s with a bazillion dollars in the bank and a life unlived, that’s a miss.