The majority of women lack confidence when it comes to decision making related to investing. That was the verdict of a recent report by BlackRock which showed that just 44 per cent of women have confidence in their financial decisions, compared to 55 per cent of men.
What’s more is that it appears women are also comparatively slow starters when it comes to saving – among those surveyed, males had saved nearly twice as much as females.
According to Karrie Van Belle, managing director for BlackRock Canada, women appear to categorize themselves as savers rather than investors – 78 per cent compared to 22 per cent. Indeed 63 per cent said they are “not knowledgeable” about investments.
“While women are doing a great job prioritizing putting money aside for their financial future, that next step of growing their wealth simply isn’t happening on the same level,” said Van Belle. “Women trail behind men when it comes to their interest and engagement in investing, and we need to do a better job of helping them understand the value of putting their money to work, and the role they can - and should – have in this area.”
So what exactly can advisors do to make women feel more confident about making investments? Wealth Professional put this question to Van Belle.
“As an industry, there needs to be greater recognition that gender differences may exist in how men and women approach their financial decisions,” she said.
“For example, our study found that while men and women equally take financial planning seriously, men are more likely to enjoy managing their investments (44 per cent) as compared to women (30 per cent), and additionally men are more likely than women to state that ‘growing their wealth’ is an important financial priority while women are more likely to prioritize ‘saving to ensure a comfortable retirement’ and ‘saving money’ more generally. As we look for ways to better support women, we need to think about the diverse servicing approaches to reach all of our clients, in the most effective way.”
So would women respond better if there were more females involved in the financial advice industry who could perhaps better understand their needs?
“It is less a focus on the gender make-up of the industry but more so on how the industry is communicating with female investors and recognizing that a one-size-fits-all approach is not effective,” she said.
“There needs to be greater recognition that women may absorb or respond to information differently, and we can all better align our conversations to respond to that reality, including both male or female advisors. We should view this as an opportunity, particularly as we prepare for a future in which women will control more of the money and more of the financial decisions than ever before.”
What is your approach to female investors? Do you treat them differently to men? Leave a comment below with your thoughts and experiences.