A recent report from Investment Week suggests that the gender investment gap reached £567 billion in 2023.
Actuarial Post, meanwhile, confirms that while more than a third of women hold a Cash ISA, men are nearly twice as likely to opt for a Stocks and Shares product.
The main factor dissuading women from investing appears to be perceived risk. When it comes to achieving your long-term goals, though, the biggest risk could not be taking enough risk.
This has been especially true during the last few years, with the UK experiencing a period of sustained high inflation and managing risk v reward remains a key part of your financial plan.
Thankfully, Fingerprint’s team of professional advisers is on hand to help. Here’s how.
The gender investment gap widened in 2023 and risk aversion could be to blame
According to Investment Week, the already large gender investment gap widened by £54 billion between January 2023 and January 2024.
The survey of 6,486 UK adults claims that men invested just over £1 trillion (up from £966 billion the previous year) while women invested £450 billion, down from £453 billion.
Actuarial Post, meanwhile, has looked at the breakdown of investment habits.
Their report finds that while most women have a savings account (61%) or cash ISA (35%), men are almost twice as likely to opt for a Stocks and Shares ISA (30% compared to 17%).
While 76% of men invest, this number falls to just 63% for women. The report found three main reasons why women choose to not invest:
- The risk is too high (18%)
- It’s too complicated (10%)
- I don’t know where to start (6%).
Advice can help to close the gender investment gap by increasing financial confidence and managing risk
While the above are all valid concerns, advice can help to mitigate all three. Here’s how:
1. The risk is too high
A key part of long-term investing is managing risk and reward. You may have heard us say this before but it bears repeating:
A successful investment does not make the highest returns in the shortest possible time. Instead, it reaches your goal within your chosen time frame while taking the smallest risk possible, in line with your risk profile.
You should only invest with a long-term goal in mind and with a firm grasp on your risk profile and capacity for loss.
We can help make sure your asset allocation aligns with your attitude to risk by revisiting it regularly and rebalancing if necessary. We’ll also diversify your portfolio to further spread risk.
Diversification involves investing across different asset classes, sectors, and geographical regions. In this way, it is hoped that a drop in one area will be offset by a rise in another.
2. It’s too complicated
At Fingerprint Financial Planning, we firmly believe in the financial benefits and value of financial advice. But these benefits can be non-financial too.
Your long-term investment is designed to meet your goals and, in so doing, it can provide peace of mind and reassurance.
Through getting to know you, your circumstances now and where you want to be in the future, we can build a plan that is right for you. We’ll explain that plan in jargon-free language, helping you to re-engage with your finances, increasing your confidence, and giving you back a sense of control.
We’ll also check in with your investment regularly to ensure it remains on track and aligned with your risk profile. All you need to do is sit back and be patient. And remember, if your long-term goal doesn’t change, your investment strategy doesn’t need to either.
3. I don’t know where to start
The start of your investment journey could be as simple as a call or email. As we mentioned earlier, during periods of high inflation, your cash savings could be effectively losing value in real terms. And while inflation is currently falling, it isn’t yet at the Bank of England’s 2% target.
Investing over the long term has the potential for higher returns than cash savings kept in a high street bank.
Get in touch now and we can explain how we manage risk and reward to ensure that your money is working hard for you.
Get in touch
If you have any questions about your portfolio, or you’re interested in investing for the first time, speak to us now. Get in touch by emailing hello@fingerprintfp.co.uk or calling 03452 100 100.
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
