Four Four Four

Four reasons: Why more women need to start investing

Thought Starters 4 minutes to read

Saxo Group

Summary:  Twice as many women entered the stock market during the corona pandemic in 2021 compared to 2020. This suggests a movement picking up momentum towards financial equality.


With the share of female clients doubling over the course of just one year, progress is clear: things are moving in the right direction towards closing the financial gender gap. However, we are still far from reaching this goal.  

So what’s keeping women from investing?  

According to several studies, most women are not aware of their existing (or potential) investment ability. Unfortunately, this is often caused by insecurity, old norms and the bad reputation of the financial industry.  

Women are, on average, saving 9% of their total annual salary, whereas men only have an average saving of 8.6%. But the gender pay gap means that women in reality have smaller savings than men, even though the percentages indicate the opposite.  

Measured in assets and investments, women are financially lagging behind men in 195 out of 195 countries in the world. Yes, it’s true: not a single country has financial equality between genders.  

Let’s challenge the present investment culture and close the gender financial gap with a win-win solution. We need women to start investing – because they are good at it!  

Here are four reasons why women should get started investing in themselves and their own future: 

Reason no. 1: Women create better profit 

Studies proves that women have an average investment profit 0.4% higher than men. It may not seem like much, but over a longer period it’s obvious, that women outperform men. And why is that? Simply read reason number two and three. 

Reason no. 2: Women know their risk  

Women live longer than men on average. That is, among other things, caused by their ability to rate risk. Same goes for investing. Women are more aware of the risks that typically come with investing. On top of that, they do more thorough research of their potential investments before pushing the “buy” button. Because of these factors, women are more likely to achieve stable and long-term profits compared to men.
  

Reason no. 3: The power of patience 

Rule number one in the investment world is that “time in the market beats timing the market”. Most women make use of the “buy and hold”-method, which is essential if you want to generate long-term returns. Historically, the global stock market has increased 7-10% a year. This implies that patience is key in the investment world, which makes women good investors.
  

Reason no. 4: Women live longer

On average, women live four years longer than men, meaning they have more time to earn money. Despite that, there is an 80% risk for a retired woman to live in poverty, compared to a retired man. That is mainly caused by the gender pay gap. In Europe men on average earn 14,1% more than women. Worldwide, the number is 32% on average. Overall, women have less money than men but live longer. That is why it’s important for women to start investing, for their own good and for the sake of their future. As mentioned in reason number three time is an important factor in order to grow your assets – so why wait? 

Female investors should keep going because they are on the right track. It is estimated that it will take 257 years before the gender financial gap is closed. That is 257 years too many. Start investing – in yourself and your future, while fighting financial inequality.  
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