According to a survey commissioned by capital.com, a platform supporting more than 4 million traders worldwide, in August 2022, only 29% of female respondents in the UK had traded or invested in stocks and shares on their own, online, vs. 47% of men. When asked to describe their investment or trading experience, only 15% of female respondents felt they were ‘informed’ investors, compared to 28% of men in the same position.
Set Goals and build a Budget
This fact is not solely due to a lack of financial knowledge. Rather, it comes from a lack of confidence in financial decision-making. According to investment advisor Birch Street Financial Advisors, above all, it is necessary to set smart goals. Progressing towards goals can be an important component of building financial self-confidence over time. One of the best ways to build confidence with money is to talk about it with family, friends, a financial advisor, or a lender. The second rule is to build a budget. This is necessary to know exactly where the money is going and avoid surprises.
A 2022 study by BNY Mellon, the world’s largest custodian bank and securities services company, calculated that if women invested at the same rate as men, there could be more than 3.22 trillion of additional capital to invest globally, with over 1.87 trillion flowing into more responsible investing. Thus, it is not necessary to be afraid of investing. Let´s start with investing in a diversified portfolio, which is often a key component of any comprehensive, long-term strategy. There are still financial advisors who can support and guide any efforts in this field.
Speak up for Women
Women often report they are not satisfied with their wealth management arrangements or financial advice, stating that they often feel their wealth managers simply do not understand their needs. Based on research by Ernst & Young, an advisory, assurance, tax, and transaction services company, 67% of female investors globally stated that their wealth managers misunderstood their goals. This dissatisfaction is also demonstrated by the finding that 70% of women switch their wealth relationship to a new financial institution within a year of their spouse’s death (for further information about effective wealth management, see www.altoo.io).
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The last piece of advice from Birch Street Financial Advisors is to advocate on behalf of all women. “No matter what gender you identify as, you can use your voice to advocate for women’s financial equality, security, and confidence. Creating meaningful conversations can help identify similar pain points amongst your peers, get your concerns addressed, and develop a safe space to grow your financial knowledge and confidence.”
