Invest Like a Woman

Susan Evans, CFP®, CDFA®

Financial Planning Analyst


To honor Women’s History Month, let’s look at recent trends, achievements, and the outlook for women in the world of finance.

Young woman looking at phone.

The gender gap in the world of financial planning and investing is quickly narrowing. Recent evidence suggests that women are starting to invest earlier than in previous generations, becoming more active in the financial planning process, and often outperforming their male counterparts.


Starting early

When it comes to investing, history shows that those who start early are more likely to have an advantage. That’s true for interest paid in a savings account, long-term returns in retirement plans, or investment strategies in a taxable account. The sooner a person starts, the more time their money can grow. A 2022 Money Moves study from Fidelity Investments invites us to compare a person starting to invest at age 25 to a person starting at age 40. With each person contributing $50 per month, by age 67, the person who started earlier will have accumulated approximately $144,000 compared to the person starting 15 years later with $46,000, assuming a hypothetical 7% annual rate of return. 1

No wonder Albert Einstein is said to have called compound interest the “eighth wonder of the world.”

The good news, according to the same Fidelity Investments study, is that women today are starting to invest nearly 10 years earlier than women in previous generations did. The survey shows that women 18 to 35 opened a brokerage account at an average age of 21, compared to age 30 for the earlier group.


Active investing

Besides opening brokerage accounts at a younger age, women are increasingly taking control of their own finances. According to a separate Fidelity study (published in 2021), 67% of women said they’re investing outside of their retirement accounts, up from just 44% in 2018.2 The survey highlights several other notable trends among women when it comes to investing:

  • 50% of survey respondents said they became more interested in investing after the pandemic began.
  • 42% reported having more to invest since the start of the pandemic.
  • 67% invested in individual stocks and 63% invested in mutual funds.
  • 90% said they’d take additional steps over the next year, including creating a plan or consulting with an advisor.
  • 49% percent of respondents making more than $100,000 a year felt confident about knowing what steps to take to invest in the stock market.
  • 86% said that working with a financial advisor made life less stressful.


Investing with purpose

The 2021 Fidelity study, which covered more than five million of the firm’s customer accounts, also found that female investors outperformed their male counterparts by 0.04% over a 10-year period. Some evidence suggests that, when it comes to generating returns, the outperformance can be attributed to a few factors. According to Wells Fargo3, these factors include:

  • Patience. Women typically trade less frequently than men. Frequent trading can hurt investment returns, because of added transaction fees, increased capital gains taxes, and market-timing missteps.
  • Diversification and discipline. Male investors tended to invest 100% of their accounts in stocks at least twice as often as women did. Men are also six times more likely to make major allocation shifts, such as switching from 100% bonds to 100% stocks or vice versa.
  • Willingness to learn. Compared with men, women are more likely to seek education and advice from investment professionals.

Women’s History Month offers an opportunity to mark women’s achievements. In the world of financial planning, women’s progress continues. More women are taking charge of their finances, making their own investment decisions, and working with financial advisors to address everyday complex situations that arise. Mercer Advisors supports women’s full participation in the financial sector, with twice the number of female advisors as the industry average. Feel free to reach out to us if you’d like to review your financial plan and the action steps you are taking on your path to economic freedom.

Mercer Advisors Inc. is the parent company of Mercer Global Advisors Inc. and is not involved with investment services. Mercer Global Advisors Inc. (“Mercer Advisors”) is registered as an investment advisor with the SEC. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.

All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change. Some of the research and ratings shown in this presentation come from third parties that are not affiliated with Mercer Advisors. The information is believed to be accurate but is not guaranteed or warranted by Mercer Advisors. Content, research, tools and stock or option symbols are for educational and illustrative purposes only and do not imply a recommendation or solicitation to buy or sell a particular security or to engage in any particular investment strategy. Diversification does not ensure a profit or guarantee against a loss. For financial planning advice specific to your circumstances, talk to a qualified professional at Mercer Advisors.

Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

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