Are women missing out on investment opportunities?
Over many years, cautious saving alone could earn you a nest egg to be proud of. But would it have amounted to more if you had invested in the stock market?
There’s a typical pattern emerging where women are saving their money but are reluctant to invest in stock market investments, other than when it comes to their pension funds. Women also tend to be more adverse to take as much investment risk as men.
The statement that women are more risk-averse than men is supported by various studies into attitudes towards investment risk between the genders. This includes The Global Women & Money Study conducted by Fidelity International. The report discusses how, although women save diligently in ISAs, they tend to save in cash ISAs whilst men tend to save in Stocks and Shares ISAs.
The report highlights that if someone had used the full ISA allowance over the four years to 2018, they would have saved a total of £65,480. In a cash ISA, this investment would have reached a total of £65,770. In a stocks and shares ISA, invested in the FTSE All Share Index, the initial investment would have reached a total of £82,434. This represents a huge 20% difference.
The situation is similar when considering the pension savings of women. They already have smaller pension funds due to lower average earnings and career breaks, and this is compounded by risk aversion throughout the accumulation period. Women also have a longer life expectancy, so any pension funds built also must last for a longer period.
How we can help
At Coole Bevis, we can work with you to establish your needs and objectives and recommend an investment strategy that is consistent with your risk profile.
If you would like to discuss savings, investments, and pensions, please get in touch with a member of our team.
The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested