Women’s progress to financial equality suffered a setback in the June quarter, as COVID shock factors put the brakes on the female-led recovery seen at the start of 2021, that’s according to the latest Financy Women’s Index (FWX).
On the plus side, the pandemic has made it more acceptable to work from home. That’s likely to benefit women, since it is usually women who take time out of the workforce to care for kids and older relatives. But it won’t do much to address the setback of the pay gap.
There are however, important steps women can take to improve their financial future. And it can all start with growing savings.
I realise that the idea of women having a so-called ‘secret’ savings account can be contentious. But growing your own savings doesn’t have to be about building a war chest to protect you from relationship breakdown.
Growing numbers of Australian couples are choosing to shun the once-accepted practice of pooling their financial resources.
These days, couples are just as likely to have a joint account solely for shared household bills, while maintaining relatively separate financial lives though still working towards shared long term goals such as a comfortable retirement.
The beauty of growing savings is that you can start to accumulate funds to invest. Yes, it can take time. But when it happens it can be very empowering. And I’ve comes across plenty of research that shows women can naturally have what it takes to be successful investors.
Women tend to research investments more than men. We’re more likely to take a long term approach rather than ducking in and out of investments, which tends to benefit your broker more than your portfolio.
If you’re not convinced, consider this. A study by UCLA Berkley found men tend to be overconfident about their ability as an investor, and trade nearly 50% more frequently than women, meaning they can experience higher costs and lower returns.
Here in Australia, research shows that women spend more time researching their options, and are better than men at matching investments to their life goals. Women are also more likely to keep a level head during any setback caused by sharemarket storms.
They all sound like pretty good credentials to enjoy investment success. The key is to have the confidence that you can do it. A good foundation for this can be boosting your own financial literacy.
There are plenty of freely available resources including on the Financy website, in our Membership, InvestSMART website, MoneySmart and Canstar.
Developing an understanding of money matters is not hard.
Most of it has a foundation in commonsense. But the more you know, the more confident you will be about making financial decisions and ultimately, about taking control of your financial future.
This article was originally published by Effie Zahos on the InvestSMART website and has been republished here with permission.
Become part of the solution to gender financial equality and join the Financy Membership. Starts at $2 a week for individuals or $10 a week for organisations. Plus, $1 of every Membership goes to UN Women and supporting women’s economic empowerment in the Pacific.
