Why aren't women investing?

Other women might not be ‘put off’ per se, but might instead believe that the minimum buy-in required will be prohibitively expensive.

The ‘save, don’t invest’ frame of mind plays a huge role here – so too do the historic preconceptions that exist about women investing, or the idea that an ‘old boys club’ mentality still reigns supreme in the investment world. 

At least in part, these views are grounded in reality. There is a staggering £1.65trn gender investment gap in the UK alone – such figures are unthinkable.

Adding to this is the fact that even in this day and age, there is a real dearth of women working in financial services and particularly in higher management roles.

The 2021 Women in Finance Charter Annual Review reported that in 2020 there was, on average, just 32 per cent female representation in senior management roles.

Ultimately these figures don’t inspire much confidence and it is little wonder that many women feel ostracised, or that a lack of empowerment is holding them back. 

FTA: Is there still too much investment jargon, and a lack of financial education?

DK: Certainly. Financial confidence is a huge problem and jargon can baffle even the most experienced investors. Put simply, not enough is currently done to ensure all people understand the fundamentals of investing.

For example, many novice investors have hopped on the online trading bandwagon in recent years, with some even failing to realise that there are very substantial differences between trading and long-term investing.

More clarity is required so that people aren’t taking unexpected risks with their money to profit in the short-term, when they might be better off building their wealth over time.

FTA: How has the pandemic and geopolitical tension affected the investment/savings decisions of women and those on lower incomes? 

DK: There are two lines of thought to consider here. Many women have taken the opportunity to save more money throughout the pandemic, with some dipping their toes into investing for the first time.

This is a step in the right direction, and something I hope will be the start of a new generation of female investors.

On the other hand, women have also been affected to a much greater extent than men by Covid-19.

Government data has shown that overall, more women than men were furloughed across the UK, with women also making up the majority of employees in the industries hardest-hit by job losses, including retail, accommodation and food services – add into this recipe the current issue of spiralling inflation and we have a real problem.