One of my biggest anxieties when I started thinking about investing was how out of place I felt. I considered it outside of my sphere of knowledge. When I thought of things like bonds, stocks or Wall Street I never associated them with myself. I felt like my expertise lied elsewhere. Why did I feel that way?
Why Are Women Not Investing?
One of the biggest drawbacks for women when they think of investing is the perception that it’s a man’s game. They lack the confidence to enter into something they do not know much about.
For me personally, I was afraid to start investing because I didn’t want to embarrass myself. When I asked questions in public I felt judged by some people. I started talking to my brother about the stock market because I felt like he was a safe person to go to with questions.
YouTube and Google are also great resources for learning about investing. These platforms became my best friends and answered all my beginner-level questions about investing. This helped me avoid that feeling of embarrassment.
A research study by Fidelity states “Women lack investing confidence: only 9% of women think they make better investors than men, despite research showing that they earn consistently better returns.” We see women consistently underestimating their potential.
Many women also have trouble deciding where to invest. There are many platforms to choose from that are intended to be easy-to-use like Robinhood, SoFi Invest, Acorns, Stash and Ally Invest. Many of these apps are commission free and have a variety of investing capabilities. Investing can feel overwhelming, and starting from scratch with no prior knowledge can sway people away before they even begin.
Sexism In other fields
I love to support and encourage women in stem, and right now there are more women than ever entering science and math fields. I also get excited seeing more women enter into politics. Having this kind of representation is important for all women.
Even though representation is improving, women are still underrepresented in many fields. Women made up only 15% of engineers in 2019. Those numbers get even smaller when we look into subfields of engineering such as mechanical engineering and civil engineering. We currently have 123 women in The House of Representatives. Women make up half of The United States but only 27% of Congress. Women jump at the opportunity to campaign during women’s controversies because those periods are believed to improve their chances of being elected.
Some of this is indeed swayed by what naturally interests women versus men, but women may still feel intimidated to enter fields that are male-dominated, and might deem them to be outside of their intellectual capacity.
Women Are Better With Savings
While women seem to have a greater fear of investment, we see that women tend to save better than men do. Some possibilities as to why women may be saving better include our smaller period in the workforce, the wage gap, and longer retirement periods.
Women also tend to exit the workforce more than men do. The most obvious reason for this is because of traditional roles when a woman becomes pregnant. Women may sacrifice their work in order to have more time at home. Child care costs make it even more difficult to balance work-life and home-life. Mothers tend to be the ones scheduling doctors’ appointments, grocery shopping, cooking and cleaning. While these responsibilities are starting to be less heavily distributed to women, we can still see the impact on their financial decisions.
Women get paid less than men on average, and with smaller paychecks comes an incentive to save that paycheck even more. A survey by Fidelity stated, “Women saved an average of 9% of their annual paychecks, compared to an average of 8.6% saved by men.” Women also tend to outlive men and women start investing more as they get older. Planning for the future becomes consistent anxiety for women as they age.
The Future For Women
Women are entering male-dominated fields in droves, so why should financial fields be left out? Whether investing becomes a side hustle or a full-time gig women should not be shying away. With women having better returns and better saving habits, we should not be so insecure about investing.
Women are thankfully becoming more comfortable with their financial decisions as the years go by. The idea that investing is a man’s game is ridiculous. Investing is for everyone and women should jump on the bandwagon right now.