Invest In Yourself To Attract Her Investment

Women are half as confident as men when it comes to investing, but when they do, they tend to be better at it. A 2021 Ellevest survey found that 49% of women said their mental and emotional health had suffered from financial stress. This is further exacerbated by the fact that women are shamed and blamed for their lack of investments. Despite these setbacks, research shows that women are now widely reported to be better at investing than men. Women tend to take a longer-term view of their finances, trade less, and spend more time researching their investment choices. Women are also more risk-aware and less susceptible to peer pressure than men.

Women tend to take a longer-term view on finances

Women also tend to retire earlier and live longer than men. This means their wealth plans need to support them for a longer lifespan. In addition, there is a notable discrepancy in pay between men and women that appears around and after childbearing years. At retirement, women aged 65 and above, on average, receive 26% less income than men from the pension system in OECD countries. However, women can partially offset these gaps with a sound investment approach.

Women's confidence in their ability to handle financial decisions grows as they age. Half of the women say they have made changes to their financial strategy after gaining knowledge of a financial topic. While women are confident in managing their short-term finances, they are less confident in long-term strategies. Women report feeling the most knowledgeable about paying bills, maintaining good credit, and saving for emergencies. However, they feel less knowledgeable about building wealth, creating investment portfolios, understanding protection products like insurance, and legacy planning.

Women's investments have outperformed men's by 40 basis points over the last 10 years, according to the Fidelity Investments 2021 Women and Investing Study. More than 65% of women are investing outside of retirement now, up from 44% in 2018. Single women also earned more from investments than men. Single women earned an average of $1,836 annually from interest, dividends, rental income, and other property income, while single men averaged $1,574.

Women's wealth continues to grow. Wealth manager Coutts says women's income globally increased from $20 trillion in 2018 to $24 trillion in 2020. Looking ahead, the Boston Consulting Group expects women's wealth to grow by $5 trillion globally every year over the next decade.

Women tend to trade less

While the stereotype of the typical investor is a man, women are increasingly entering the investing landscape. However, it is true that women tend to trade less than men. This can be attributed to various factors, including confidence, gender stereotypes, and structural barriers.

Confidence and Gender Stereotypes

Women are often portrayed as less confident than men when it comes to investing. According to WealthiHer, women are half as confident as men when it comes to investing. This lack of confidence may contribute to their lower participation in trading. Additionally, women are often conditioned by society to believe that they are not good with money, which can further discourage them from engaging in trading activities.

Structural Barriers

Several structural barriers also contribute to women trading less than men. Women-led firms, particularly in the service sectors, are generally smaller and younger than those led by men. As a result, they may face significant fixed costs and hurdles when attempting to begin exporting. Additionally, women-led firms tend to be concentrated in industries that are less inclined towards international trade, further reducing their involvement in trading.

Risk Averse

Women are also more risk-averse than men when it comes to investing. A survey by Capital.com found that more women than men preferred to save money rather than invest it. Additionally, when asked about their reluctance to trade online, 58% of female respondents cited the risk as a major concern, compared to 47% of men. This risk-averse attitude may contribute to women trading less frequently than men.

Knowledge and Research

Women also tend to spend more time researching their investment choices and are more engaged in understanding the fundamentals of investing. This additional research may lead to a more cautious approach to trading, resulting in fewer trades overall.

Long-Term Focus

Women often take a longer-term view of their finances, which can result in a more patient and disciplined approach to investing. This long-term focus may contribute to a lower trading frequency compared to men, who may be more inclined to make impulsive or short-term trades.

While the gender investment gap persists, it is important to note that women are making significant progress in this area. The COVID-19 pandemic may have played a role in narrowing the gap, as more people, including women, turned to DIY trading as a way to supplement their income during the pandemic. Additionally, women investors are demonstrating greater discipline and consideration when investing, which may contribute to their overall success in the long run.

Women spend more time researching their investment choices

Research shows that women spend more time than men researching their investment choices. This extra research pays off, as women tend to make better investment decisions than men. A study by Fidelity, covering 5.2 million customer accounts, found that women outperformed their male counterparts by 0.4% annually over a 10-year period. This is due in part to women's tendency to take on appropriate levels of risk and avoid "chasing 'hot' tips and trading on whims", behaviours that often hurt men's portfolios.

Women's greater engagement in the "why's" of investing leads them to develop a comprehensive plan before diving into the details. This long-term focus gives them a powerful advantage over men, who are more likely to be overconfident and trade excessively.

Women's tendency to conduct thorough research before investing may be one reason why they are more successful investors than men. By taking the time to understand their investment choices, women are able to make more informed decisions and avoid costly mistakes. This research also helps women stay calm during market volatility and avoid locking in losses when the market takes a tumble.

In addition to their own portfolios, women are also more likely to invest in their families. According to one source, women reinvest more than 90% of their assets and earnings into their families' nutrition, education, and healthcare, compared to just 44% for men. This reinvestment creates more sustainability within the family unit and the community at large.

Women's approach to investing is not just about playing the investing game; it's about how building their wealth can lead to a broader set of goals for their families, philanthropic initiatives, and the world.

Women are more risk-aware

While women are not inherently more risk-averse than men, they do tend to be more risk-aware. This means that they are more likely to consider the potential consequences of their actions and make decisions accordingly. This is not to say that women are afraid to take risks, but rather that they approach risk-taking in a more calculated and informed manner.

Research has shown that when women do take risks, they are often judged more harshly and face more negative consequences than men. This can create a cycle where women are less likely to take risks in the future, not because they are inherently risk-averse, but because they have learned from past experiences that taking risks often leads to backlash.

For example, in the workplace, women are often penalized for displaying ambition, assertiveness, or seeking higher pay—all of which are typically associated with masculine traits. This dynamic can make it difficult for women to advance in their careers, as risk-taking is often seen as a necessary step towards achieving leadership positions.

Additionally, the types of risks that women take are often overlooked or undervalued by society. For instance, undergoing cosmetic surgery or engaging in horseback riding or cheerleading—all of which are physically dangerous activities—are not typically considered "risky" in the same way that riding a motorcycle without a helmet might be. As a result, it may appear that women are less willing to take risks when, in reality, they are simply navigating a different set of social expectations and consequences.

Overall, it is important to recognize that women's approach to risk-taking is shaped by societal expectations and gender norms. While women may be more risk-aware than men, this does not mean that they are less ambitious or less capable of achieving success. On the contrary, by taking calculated risks and considering the potential consequences, women often make more informed and strategic decisions.

Women are less susceptible to peer pressure

While it is well-known that adolescents often engage in risk-taking behaviours in social settings among their peers, it is unclear whether there are gender differences in susceptibility to deviant peer pressure. However, a review of 26 studies revealed two primary trends:

• Adolescent males appear to be more susceptible to peer influences that encourage risk-taking behaviours.
• There is no consistent gender difference in susceptibility to such peer influences.

Only two studies reviewed suggested that adolescent females are more susceptible to deviant peer pressure than adolescent males. Gender role socialization theory is consistent with the observed trend that adolescent males are more susceptible to deviant peer pressure for risk-taking behaviours than females as they seek alignment with the masculine ideal.

Additionally, there is evidence that adolescent females are more resistant to deviant peer influences than males. This may be because adolescent females' sensitivity to social relationships is an asset that facilitates interpersonal competence rather than deviance. Adolescent females may be better able to resist deviant peer influences as they simultaneously consider how their involvement in risky behaviours might damage other highly valued relationships with parents, teachers, and friends.

Furthermore, there is evidence that early adolescents perceive social status and risky, defiant behaviours to be more closely associated with male popularity and peer approval. Males who deviate from gender-congruent expectations experience negative social consequences, such as peer rejection. As a result, males may feel socialization pressures to assert traditionally masculine behaviours such as rule-breaking and defiance.

In contrast, there is evidence that girls are more likely to be influenced by their parents than their peers. Girls are also more likely to be influenced by their peers when it comes to body image. Girls are more likely to feel pressure from friends and the media to lose weight and pursue thin ideals in health-compromising and risky ways.

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