Investing more important for women than men
Women stand to gain more from investing in the stock market than men, yet worrying about risk, whether they have enough to invest, or if they know enough to decide where to put their money stop them from taking the plunge.
Ahead of International Women’s Day tomorrow, new research from Fidelity International has painted a grim picture of women’s involvement in investing, even though, as they live longer and have on average far less superannuation than men, they need to make their money go further.
Over half of the 800 women surveyed by CoreData for Fidelity said that they didn’t have any spare money to invest, compared to 35.2 per cent of the sample of 400 men. This could perhaps be because 46.3 per cent of the women believed they needed a lot of money to invest in the stock market.
Women also largely weren’t confident enough in their financial knowledge in invest, with only 28.3 per cent feeling “very” or “somewhat” confident in investing as opposed to over 50 per cent of the men. The investment industry was partly to blame for this, with 20.8 per cent of women believing industry communications were “tailored to men”, 25 per cent labelling them as “intimidating”, and over half finding them “complicated”.
Fidelity International’s managing director in Australia, Alva Devoy, said that these problems with communications were “absolutely something we [the investment industry] have to change”.
Suggestions for changes were given by research participants, with more plain language, fewer buzzwords by advisers, simplified information, and guidance on the practical application of investment options all being put forward.
Women also showed higher aversion to risk in investing, with 46.2 per cent of women saying risk minimisation was a priority compared to just over a quarter of men. More than double the number of women than men, at 33.8 and 15.7 per cent respectively, described their risk appetite as “very low risk”.
Devoy called on the industry to use this information as an impetus to improve women’s investing confidence and experience.
“Despite recent progress, women are still earning less, they take career breaks, and there are fewer of them in senior positions which has resulted in a superannuation gap,” she said. “If women’s ability to earn and then save during their working lives is less than men’s, then it’s more important than ever that they have access to the tools to make their money work hard for them.”
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