Financial independence in the 21st Century

What is financial independence and how can you achieve it? Daniela Haunstein (Business Angel & Entrepreneur), Marietta Babos (Founder of Damensache) and Larissa Kravitz (Founder of Investoralla) about the core values of becoming financially independent – a discussion moderated by Florian Bräuer (Head of Product at the female factor).



Florian Bräuer: When we talk about financial independence we often mean freedom. I remember six years ago when I founded a startup I dreamed about building a Million-Euro-Business making a huge exit. Two years ago, I lost the company and also a family member. That’s when I started to ask myself, what is freedom? And now, freedom for me means being able to do whatever I want. What’s your take on freedom in the context of money?


Daniela Haunstein: As I see it, money shouldn’t restrict your life. It’s never good to be dependent on something.


Marietta Babos: Additionally, this independence must last throughout one’s entire life. As long as you’re working you might gain a regular income, but what if you retire? It’s a topic that definitely needs more attention.


Larissa Kravitz: My perspective on financial freedom is very mathematical. For me, financial freedom means having enough money to cover your expenses. Being able to buy something when you want it.


👨‍👩‍👧 Finance as a family affair

Florian Bräuer: Now, is financial independence just a business of ourselves or is it a family affair?


Marietta Babos: In most cases, it should definitely be a family-matter. Many women keep working part-time after getting children which drastically lowers their pension. They lose a lot of money. And considering the divorce rate in Austria lies at around 40 percent, lacking several years of regular income and pension-payments is a huge financial risk. But in Austria, there’s an option for parents to split their pension-payments into two equal halves until their child is 10 years old.


Marietta Babos: "Many women keep working part-time after getting children which drastically lowers their pension."

Larissa Kravitz: Indeed. So, when one parent only works part-time and the other one full-time, they together earn 1,5 times of a full-time-income. And with pension splitting, they can distribute the income in a way, so that everyone gets a 75-percent-piece. The only problem is that nearly nobody uses this option in Austria. And if a couple does practice pension-splitting, it has often been initialized by the man when he got on maternity leave. It’s absurd. We definitely need to think about this.


📡 Strategies for becoming financially independent

Florian Bräuer: We now know what financial independence means – but how do we get there?


Daniela Haunstein: One big part definitely consists of investing. I grew up with entrepreneurs – my parents and grandparents all ran businesses. Therefore, being independent always meant a lot to me and two years ago and I found a passion for investing in companies. One of the companies I invested in was Finabro, a platform where you can start investing in ETFs and other assets with as little as 25 Euros. If you start investing on a platform like this, you can easily build yourself a savings-account which allows you to become as financially free as possible.


Larissa Kravitz: Indeed, all you need to start investing is a brokerage account plus several sources of information for your investment choices. It’s a skill that can be learned which brings huge advantages.


👱🏾‍♀️ Gender and entering investing

Florian Bräuer: Is there a difference in the way how women and men invest in assets?


Larissa Kravitz: "Women tend to research more and eventually achieve a better distribution of risk and return – whereas men tend to be overconfident."

Larissa Kravitz: Certainly, there’s a big difference in how men and women approach it. My husband is the best example: When he started to invest, he didn’t have a portfolio, he just bought a bunch of stocks online. Many men will just dive into it – which isn’t the most recommendable approach. You need to evaluate the risks and diversify your portfolio if you want to make a profit on the stock market. Women tend to be more subtle and thoughtful from the beginning. They research more and eventually achieve a better distribution of risk and return – whereas men tend to be overconfident. 


Florian Bräuer: Marietta, Daniela, how did you start investing?


Marietta Babos: Honestly, my story of investing is a bit different. At the start of my career, I earned a lot of money and didn’t have the time to spend it. Therefore, I had left a lot of money on my bank account after some time – and I used it to buy property which turned out to be a good decision. Aside from that, the single most important tip is to save 10 to 15 percent of your income each month. There’s a saying that the best time to start saving was yesterday and the second-best time is today.


Daniela Haunstein: Due to the fact that I invest in companies, my story is quite different as well – because investing in startups is generally very risky compared to property or traditional products on the stock market. That's why you need a very broad portfolio when doing it. There are always some companies who don't succeed. But, if they do succeed, they can be a very lucrative long-term investment. And apart from that, I also invest in the stock market in a more traditional way.


🏁 How to start?

Larissa Kravitz: What I’d recommend when starting out as an investor is to begin with more diversified products like bonds or ETFs – and as you start building your portfolio, you move on to more risky investments like stocks, properties or even companies.


Florian Bräuer: Okay, so how large should your regular investment-sum be?


Marietta Babos: I recommend everybody to go through one’s expenses in an average month. From my experience, most people can easily save about eight Euros per day if they don’t eat out that much and rethink their spendings. These eight Euros per day add up to 240 Euros a month which is more than enough for a solid investment plan. 


🗣 Talking about money

Florian Bräuer: I have one last question – does money have a reputational problem among women? Do women talk enough about money?


Larissa Kravitz: They increasingly do, even though we’re not quite there yet. But when you view the topic from a generational perspective, talking about money is becoming more of an everyday-thing than ever. 75 percent of millennials talk about money at least twice per week with their partner while only 44 percent of baby-boomers do.


The panel was carried out at the limitless-experience on November 8th with the topic “hacking money”. During the mini-conference, we discussed money from all perspectives. Are you interested in becoming part of those events? We’re a community of female change-makers aiming to unlock everyone's full potential. We offer exclusive masterclasses and access to world-class mentors. Learn more and join us today.

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