The gender gap weighs heavily on the health of our economic systems, yet those involved in the gender economy continue to struggle with the tendency not to invest in activities that promote gender equality in business and finance. Fortunately, things are slowly changing, and initiatives such as Capitale Donna (which we are proud to support), an independent information campaign to promote women's access to investment by Scai Comunicazione and Equity Crowdfunding News, with the support of public and private organisations, are emerging.
What the data says
When it comes to savings and investments, women unfortunately still occupy the back seat. According to the OECD, among Western European countries, Italy is at the bottom of the list in terms of women's financial skills. Yet women are better at their studies, more careful about saving and in many cases are still completely responsible for the family economy. But somewhere, at some point, the mechanism gets jammed.
European women invest an average of EUR 857.52 of their monthly income, with the majority investing between EUR 100 and EUR 499 per month. Austrian women invest the most, with an average of €999.37 per month. In general, however, European women invest on average 29% less of their monthly income than men, who invest an average of €1,184.49 per month.
Seventy per cent of female investors say they intend to increase their investments from 2023. This is especially true among Italian and German women, who hope to reach an average of €1,735.82 and €1,438.97 respectively.
According to research conducted by N26, there are still numerous obstacles preventing women from investing more - among all, lack of money is cited as the biggest difficulty among those who invest (45%). This could indicate systemic challenges for women, such as unequal pay or the financial burden of child support.
Another survey conducted by Morningstar.co.uk also found that women, compared to men, less frequently seek financial advice through professional channels, relying instead more on informal channels such as friends and family.
The survey also highlighted two other gender stereotypes related to money: women are motivated to earn money mainly to fulfil a family and relational life project, while money is not important for realising and enhancing one's identity. The second is that these stereotypical beliefs are associated with women's poorer performance with regard to money.
How to close the gap
To change the stereotypical thoughts that influence the relationship between women and money, it would be necessary to increase the number of female financial advisors. It would also help if male financial advisors were made more aware of the influence that gender stereotypes have on their behaviour.
Research on the topic of women and investments suggests that female behaviour may be influenced by the fact that they feel misunderstood in the world of finance. Data says that female investors are more willing than men to consider switching to another financial advisor, and 70% of widowed women switch advisors within a year of their partner's death. It would also seem that advisors are more likely to ask women (+40% compared to men) to transfer their accounts before providing any advice. Moreover, according to women, advisors assume that they have a low risk tolerance and are interested in sustainable funds. Consequently, they are often offered a more limited range of investment options.
This suggests that most of the supposed differences between men and women in terms of savings and investment choices disappear when comparing them for the same income.
The study conducted by N26, suggests several approaches that can help women to invest. First, talk openly about investments. Open conversations can help women gain confidence in this field.
Expanding access to information and resources is also very helpful, particularly in relation to promoting access to educational resources specifically designed for women to help them address the unique challenges of this landscape and level the playing field.
Finally, recognising and addressing gender inequalities is of paramount importance. The pandemic has only helped to increase some of the financial difficulties faced by women, who statistically bear the burden of supporting children and household activities. Addressing these obstacles and continuing to reduce the gender pay gap may encourage more women to invest in full confidence.
Research cited in the article:
https://n26.com/it-it/ricerca-donne-e-investimenti
https://www.bluerating.com/banche-e-reti/753883/consulenti-ecco-perche-le-donne-investono-meno