*This content is provided by Brenthurst Wealth
Author: Leslie Grayling*
Although there are still some women who prefer to leave family decisions related to finances and investments to their partner or husband, we have seen some changes in recent years. According to statistics, women are more likely to live longer than their male counterparts, which means they need to understand their finances and prepare to plan and manage their retirement in the years to come.
You never know how your future will turn out, make sure you are prepared for any contingencies and have enough funds to be financially independent.
Although the gender pay gap persists around the world, more and more women are becoming economically active and taking responsibility for their own finances.
Women make up a smaller portion of investors than men, but they hold significant amounts of wealth. A McKinsey report published this June shows that in Western Europe, women investors now control around a third of total assets under management (AUM), estimated at around €4.6 trillion. The report estimates that by 2030, women’s share of investments should reach 45% of AUM and a total of €10 trillion.
This means that while women used to be discouraged from pursuing careers, creating their own investment strategies, or learning the principles of investing, this is no longer the norm. But there are still many women who lack confidence when it comes to long-term investing, and on average, they invest about 40% less than men.
Women’s hesitancy to invest is characterized by risk aversion and a preference for more conservative investment styles. Research shows that women are more afraid of big losses and less impulsive when it comes to investment decisions.
Having a financial plan will keep you on track when the markets are falling and prevent you from making rash moves when the markets are rising. You will stay on track to achieve your financial goals.
Generally, women take more time off from work than men because of domestic responsibilities, such as caring for children or helping elderly parents. This can result in them being overlooked for promotions or receiving smaller annual raises, which in turn can affect their ability to save enough for retirement.
A growing number of women are growing their wealth on their own and appreciate the benefits of working with a financial advisor who understands their circumstances and reality.
Research conducted in the UK shows that 70% of female investors prefer to work with female advisors. They can relate to their specific problems and understand them and appreciate their benefits. Women’s perspective on investing is unique and they are likely to seek investment options that match their behavioral financial profile, risk tolerance and time horizon, which in most cases is different from men’s.
The female population in SA is 50.76% and women hold 44% of skilled jobs, including professional and managerial positions. An alarming statistic is that 42% of women are single parents.
This shows how important it is for women to have their own financial plan and goals that can be achieved with the help and guidance of a financial advisor.
Women should be empowered to take responsibility for their own financial well-being.
This Women’s Month, why not take control of your finances by implementing your own investment strategy?
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