Women in the UK are set to own a greater proportion of wealth than men, yet findings from JM Finn’s new report show women continue to lag men when it comes to investing.
According to the report ‘Wealth in Women’s Hands’, a combination of inherited wealth, divorce and growing career opportunities, is leading to an increase in the volume of wealth among women.
Female entrepreneurs now out earn their male counterparts by 14%, with an average annual income of £382,000 compared to £327,000 for men.
Despite this, women and men’s financial priorities and appetite for risk differ. Among JM Finn’s client base, 66% of men said their main financial concern is the performance of their portfolio, compared to 51% of women.
The findings showed that women’s leading concerns are less intertwined with their investment portfolio and more with everyday financial matters. Men have stronger concerns around the impact of inflation on their investments (57% of men compared to 51% of women), while women are more concerned with the rising cost of living (39% compared to 33% of men).
Women also rate their confidence surrounding financial matters lower than male counterparts, with nearly a quarter (23%) saying they lack confidence in managing their money. Despite women closing the gender pay gap, they are still far less likely to invest than men, contributing to a £599 billion investing gap between men and women in the UK.
According to JM Finn, a staggering 3.3 million more men in the UK than women hold investments, with just one in 10 women saying they understand investing.
Meanwhile, more than 8 in 10 (82%) women describe themselves as having a low appetite for risk, compared with 69% of men.
Anna Murdock, head of wealth planning at JM Finn, said: “While many women are becoming more affluent, they are still less likely than men to invest their money or use wealth planning services. The fact that only 1 in 10 women say they understand investment may be unsurprising given that investing has historically often been seen as a male preserve.
“Despite the rise in UK women holding wealth in their own right, women remain far less likely to invest or to use wealth planning services. Given men and women start their wealth journeys at different levels, women may need to save more to achieve similar outcomes.”
JM Finn said personal service is key in attracting female investors.
Oliver Tregoning, head of marketing at JM Finn, commented: “There is overwhelming evidence that women will own the lion’s share of wealth in the not-too-distant future, thanks to the huge wealth transfer taking place at present. We have always felt the best way to equip individuals with the knowledge to look after their financial affairs is by building trust which starts with a strong relationship founded in relevant and appropriate communications. By retaining the client communications at the investment manager level, we are confident a personalised approach can continue to help women look after their wealth to accommodate and meet their specific needs.”
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