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The future of investing is female: How women are increasingly looking to future proof their finances

Why do women invest less than men? On International Women's Day, we look at the importance of female financial planning and what wealth managers must do to better understand what drives women’s investing decisions

4 min read


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One of the less talked about consequences of the Covid crisis is how it amplified the financial disparity between men and women. From the disproportionate number of furloughed women to exacerbating the gender pay gap, women were more likely to have felt financial strain. A strain compounded by the fact that women typically took on the lion’s share of childcare and home schooling during the lockdowns. 

This disparity has historically been a big reason why women have been less inclined to invest their finances than men, a remnant of traditional gender roles where family finances were typically handled by the husband. According to Fidelity's 2021 Global Women & Money study, only a third of women in the UK consider themselves as investors compared to 41% of men, while only 43% of UK women make active decision about where to save and where to invest.

However, the rise in the numbers of women in work coupled with shifting generational attitudes means this dynamic is rapidly changing and with it the inclination of women to take the lead in financial decisions.


"The key differences between male and female investors is their objective and end goal, with women tending to lean towards prioritising financial security and providing for their families."

Women are controlling more of the world’s wealth

Despite the setbacks caused by the pandemic, the longer-term trend has seen women rightfully gain an increasing share of global income. Between 2018 and 2020, women’s incomes increased from $20tn to $24tn, with 100 million more women expected to enter the global workforce by 2030. We are also seeing a growth in female entrepreneurism, with women representing about one in three growth-oriented entrepreneurs active in the world today.

With women increasingly taking charge of their financial planning, it is imperative wealth managers do more to make women an intrinsic part of the investment dialogue. The issue has been that wealth management companies have historically largely been used to targeting men, meaning the language, imagery and messaging women have encountered may have done little to sway them to invest.

If wealth managers are to be truly representative, they need  to effectively communicate with women to better understand what is driving their investment decisions. For all clients, this means taking into account age, family, and social and cultural considerations to better serve their specific goals. 


Understanding women’s investment needs

According to Francesca Stott, Associate Director, Chartered Financial Planning Specialist at Coutts, the key differences between male and female investors is their end goal. She believes future-proofing their wealth is top of mind for women investors as they tend to lean towards prioritising financial security and providing for their families. “A lot of my female clients focus on succession planning,” she says.

These goals may contribute to the belief that women investors are risk averse, but Francesca disagrees. She argues women investors are influenced by specific ambitions and objectives as they like to “think further down the line about the next generation rather than just thinking about the right now.”

This tendency towards protecting their money for the future may also have stemmed from the pandemic as many women investors spoke of the importance of a ‘rainy day fund’ for unforeseen emergencies. Francesca argues that many of her female clients were concerned with ensuring their children or grandchildren’s financial needs could be met, whether that means providing for their education, helping them get onto the property ladder, or gifting them tax efficient early inheritance.

Another characteristic among female investors is the greater deal of time spent researching investments. “Women request more initial meetings to discuss opportunities compared to men,” Francesca notes. It may be this additional research that has led women to outperform men, as women’s investment returns were reported as 0.4% higher than men’s, on average, according to Fidelity’s 2021 Women & Investing report. This makes it all the more crucial that women investors are catered for by wealth managers.

While men and women may differ slightly in why and how they invest, understanding what drives their decision making and giving them the right educational building blocks to kickstart their investment journey is crucial. As Francesca says, “it's an exciting time for women in business and this will hopefully translate into a greater number of women in investing.”



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