Naari, Janani, Women - A Better Investor!
‘Investments’ often initiate a common notion that women need to be well explained when it comes to understanding finance. The age-old belief that women are risk-averse spenders permeates deeply back in time and most attention was given by the media and the age-old societal norms that discourage women from being excessive shoppers to financial advisors who assume their female clients want less control over their investments.
But we don't accept these stereotypes blindly. In fact, women investors consistently outperform as compared to their male counterparts, which could leave them with a lot more money during retirement due to great financial planning experience.
Let’s understand how women's investment approach works and why they excel so well. This can help everyone, regardless of their gender, do a better job with their investments.
Strong Research, Risk Aversion, and Self-Control
Many studies across the world have shown that women spend more time researching their investment choices as they believe that they need to be 100% sure to make a decision. And while they do take on less risk than men when it comes to investing, that does not imply they are ‘Risk averse’. Rather, they are more likely to take on appropriate levels of risk with their investments as compared to men. Both of these findings make way for better investing outcomes in the long run.
Eat like a King, Invest like a Woman!
Whether you are choosing an investment option to save tax, gain profit out of it, or while choosing for an asset allocation, start by outlining simple rules that dictate when and why you would buy and sell a given investment. Setting parameters ahead of time ensures you navigate the market deliberately, rather than reacting to the latest whims of financial news and making decisions in a haste.
Overcoming the Gender Income Gap present
Despite many types of research suggesting that women outperform men when it comes to investing, some women are still hesitant. This may at least be due to the gender income gap, women simply have less free money to invest. Depending on race and ethnicity, this gap can leave women with 50% to 90% of what men earn, which obviously greatly hinders women’s abilities to invest.
While this systemic obstacle cannot be fixed by individuals, we would like to see more women thinking of themselves as breadwinners to help ameliorate these wage and wealth gaps.
To summarize it all in one go, as a society it’s high time we bridge this gap created for women and have a positive outlook towards investment being more gender unbiased and equal.
Let’s wish all the females a Happy Investing journey and pledge towards having financial equality in practice rather than just preaching in books!