As much as us women hate to admit it, gender disparity is still around. It might not be as bad as the 1950s when a woman was told to be “a little more interesting” for her husband and to “let him talk first — remember, his topics of conversation are more important than yours” (yup, that is genuine advice from the 1955 ‘Good House Wife’s Guide’….).
But according to the Office for National Statistics, on average women are still being paid 7.9% less than men*. And almost everywhere you look there is the assumption that women need to be persuaded into taking interest in financial investment. The idea that they’re risk-adverse or want less control over their investments is rubbish. In fact, it’s been shown in Fidelity’s 2021 Women & Investing report that women investors consistently outperform their male counterparts**.
We’ve done some digging and spoken to Coutts, the private banking company, to find out the truth about women and finance.
Who runs the world? Girls!
In the words of our girl Queen Bey, it’s obvious who runs this world. Just look at the stats. Between 2018 and 2020, women’s incomes increased from $20 trillion to $24 trillion, with 100 million more women expected to enter the global workforce by 2030***. This long-term trend has seen women gain an increasing share of global income.
Not only that, but there’s also a big female entrepreneur movement (we need not remind you that The Handbook was founded and is run by a woman). In fact, women represent about one in three growth-oriented entrepreneurs active in the world today***.
Women represent about one in three growth-oriented entrepreneurs.
Female investors consistently outperform their male counterparts.
What makes women so good at investing?
Women have often been described as risk-adverse with their investments, but in fact, they just tend to think about the long-term rather than short-term. For example, women might be more concerned about saving for their children or getting onto the property ladder. Whereas men might be more likely to chase a trading whim or follow a tip. Francesca Stott, Associate Director, Chartered Financial Planning Specialist at Coutts, says, women “think further down the line about the next generation rather than just thinking about the right now.”
Female investors also spend a lot more time researching investments. For example, Francesca says: “women request more initial meetings to discuss opportunities compared to men.” It might be this additional research that has led women’s investment returns to outperform men’s by 0.4%, on average***.
What’s holding women back?
It’s all about confidence. If you’re consistently told you’re not good at something, you’ll start to believe it. Women have long been left out of messaging by the media and financial institutions when it comes to investing. And it’s had an effect.
The FCA’s Financial Lives 2022 survey showed that women feel less comfortable dealing with financial services than men†. This means that women are less inclined to invest their money than men. According to Fidelity, only a third of women in the UK consider themselves as investors compared to 41% of men, while only 43% of UK women make active decisions about where to save and where to invest††.
However, with more women than ever leading the way in the work place, this shift in financial decision-making is on the rise.
A shift in financial decision making is on the rise.
Advisers like Coutts could provide the right building blocks for your investment journey, whatever your gender.
The changing face of wealth management
With all this change and all these women carving out a fierce future for themselves, wealth managers are stepping up. Finance companies have always targeted men – they’ve been in the ads and they’ve had messages directed at them.
But that’s all changing. Take Coutts for example. The private banking company is working to better understand what is driving women’s investment decisions, taking into account all sorts of things, from their age to their cultural preferences, so they could better help them. While there is still a difference to how men and women invest, advisers like Coutts could provide the right building blocks to start an investment journey, whatever your gender.
Coutts is a wealth manager and private bank with three centuries of experience, providing customised solutions for its clients. These include discretionary and advisory investment management services as well as advice on philanthropy, family businesses, succession planning and commercial banking services to corporate clients. They could help provide you with sustainable financial options for your wealth that best suit you.
*House of Commons Library, 2022, The Gender Pay Gap
**Fidelity Investments, 2021 Women and Investing Study
***Coutts, 2022, The Future of Investing is Female
†Financial Lives, 2020 survey: the impact of coronavirus
††Fidelity, Global Women & Money Study 2021
RISK WARNING: INVESTMENT VALUES CAN FALL AND RISE, YOUR CAPITAL IS AT RISK.
Coutts works with private clients over 18 who borrow or invest more than £1 million with us, fees may apply.
To find out more about how you can start investing, please visit www.coutts.com