When it comes to investing, the biggest mistake women make has nothing to do with where they're choosing to invest their money — in fact, women tend to earn higher returns than men.
Rather, the issue is they're not investing enough in the first place, says Sallie Krawcheck, co-founder and CEO of Ellevest, a digital investment platform for women.
"We certainly don't invest as much as men do," Krawcheck tells CNBC Make It. "We tend to leave more than 70% of our wealth in cash as opposed to investing it. For the typical professional woman, that can cost her hundreds of thousands — for some women, millions — of dollars over the course of their lives."
Not putting their money to work can be "a bigger drain on their net worth than the gender pay gap," Krawcheck adds.
That's why her No. 1 piece of financial advice for women is to simply start investing. Ellevest, the robo-advisor that Krawcheck founded in 2014 to help close the gender investing gap, makes it easy to do so — there's no minimum required to open an account. Here are some other low-stress ways to dip your toe in investing:
- Enroll in your company's 401(k) retirement plan and take full advantage of any company match, which is essentially free money.
- Contribute to an individual retirement account that offers tax breaks, like a Roth IRA or a traditional IRA.
- Use a micro-investing app like Acorns or Stash, which make investing simple and accessible. Acorns even lets you invest your "spare change" by rounding up your purchases to the nearest dollar and automatically putting your coins to work.
- Look into low-cost index funds, which Warren Buffett recommends. Index funds hold every stock in an index such as the S&P 500, including big-name companies such as Apple, Microsoft and Google. Because this type of fund is highly diversified, it stays relatively constant and avoids some of the risk that comes with picking individual stocks.
A dollar invested in your 20s is worth more than a dollar invested in your 30s is worth more than a dollar invested in your 40s.Sallie KrawcheckEllevest co-founder and CEO
Regardless of where you decide to invest your money, start today. The longer you wait, the more you'll miss out on compound interest, which will help your wealth grow so you can save hundreds of thousands or even millions of dollars.
More from Invest in You:
Women must keep finding ways to avoid the 'money FOG'
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Jean Chatzky: Here's how women can take control of their finances
As Krawcheck puts it: "A dollar invested in your 20s is worth more than a dollar invested in your 30s is worth more than a dollar invested in your 40s is worth much more than in your 50s, 60s or 70s."
CHECK OUT: 3 steps to take if you want to retire by 65 via Grow with Acorns+CNBC.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.
