New Survey: The Financial Habits of Women
New data finds women looking for ways to alleviate financial stress, turning to values-based solutions to create a more secure financial future.
Results from a survey focused on the financial habits of women shows that three-in-five Australian women investors (i.e. those who have investment experience or are interested in investment) feel stressed about their financial future.
Conducted in August 2023 by YouGov on behalf of Verve Money, the independent survey^ considered the financial habits of Australians and determined that when thinking about their financial future, including future investments, 60% of women investors felt stressed, compared to 50% of male investors.
According to CEO of Verve Money, Christina Hobbs, the research highlighted that in response to feeling financially stressed, women are seeking solutions and ways to create a more secure financial future.
The survey highlighted that as a result of finding investment and financial stressful, 36% of women investors report they plan to invest less or not invest at all over the next 12 months, while 35% of male investors plan to increase their investment portfolio.
No matter how much women earn, they’re still not as comfortable investing as men
Christina said: “One of the most interesting findings from the survey is that across the board, no matter age or income bracket, Australian women are less likely to invest than men.
“The survey showed that a burden of household responsibilities (22%), a perceived lack of experience with money management (31%), fear of losing money (38%), and lack of investable assets (23%), are the major reasons women choose not to invest.”
The data showed that across the board, less than two-in-five (38%) women have investment experience, while three-in-five (60%) male respondents reported having investment experience. Beyond this, of the small number of women who felt they have experience in investing, just over one-in-two (56%) currently hold investment products, while over eight-in-10 (83%) male investors currently hold investment products.
In fact, the research showed that amongst those with investment experience, just one-third (33%) of women with household income of more than $150,000 hold investment products, compared to nine-in-ten (91%) of men with household income of more than $150,000.
“In a bid to understand why women were less likely to invest than men, we asked questions to understand the role that external influenced and value-based investing might play when it comes to decision making,” continued Christina.
According to the survey findings, when asked why they made investment decisions with someone else, one-in-three (33%) Australian women wanted to manage their own finances, but only 17% of Australian women believed they were best at managing their money when it comes to setting and achieving financial goals. This increases slightly for younger women (Gen Z and Millennials), with just 21% reporting they are the best at managing their own money.
“What this suggests to us is that there are still cultural factors that impact women’s confidence when it comes to managing money. We know that parents are still more likely to talk about investing and wealth building with their sons compared to their daughters and that talking about money is still a taboo for many women. To increase confidence we’re going to need to break these cultural taboos”.
“However, most women struggle to know who to trust when it comes to investing, especially when investing with personal values in mind,” Christina said.
Women prioritise values more than men when making investment decisions
When deciding what to invest in, 70% of women reported that they often or always considered their values compared to 66% of men.
“Getting rich for the sake of it is not a motivating factor for women investors. Growing their wealth matters but what they are investing their money into matters more, it is why ethical investment solutions are something we specialise in.”
Younger women officially more financially independent
Despite women responding that they were less likely to invest than men, the survey showed that there is a trend in younger women making investment decisions on their own.
The survey found that 71% of Millennial and Gen Z aged women made all their investment decisions independently.
“We’re currently seeing a generational shift as more younger women take control of their investment decisions, as seven-in-ten (71%) Millennial and Gen Z aged women make these decisions on their own, compared to just slightly over one-in-two (55%) Gen X and above aged women. It shows that younger women are less likely to rely on a partner to manage their future wealth and they are keen to take control of it,” Christina said.
Verve Money was created to support Australian women to better understand investing and build wealth. The platform is designed with women investors in mind and features three diversified ethically invested portfolios.
“We want more Australian women to feel confident in building their wealth, and we want to help them set and achieve their financial goals. Investing should be seen as an option for women regardless of their personal circumstance, salary, dependants, marital status.”
Below are some tips to get started:
- Choose diversified portfolios curated by experts – Spreading your money across multiple asset classes is not only a smart way to invest – it can also help to minimise risk, which can offer peace of mind for women who are more risk-averse. The good news is you don’t need to do it yourself, look for managed funds offered through an app – investing apps like Verve Money – with sophisticated investment processes going on in the background but an interface that’s simple for you, the investor.
- Align your values with your investments – Do your research on managed funds to find out what industries and assets they invest in and which ones they actively screen out. Start by checking out each fund’s website for information about their investment strategy and a transparent and comprehensive list of their investments. This will help you make an informed decision about whether the fund’s values align with yours.
- If you’re starting small, look for low fee investment products – You don’t want to erode your balance with high fees, especially if you are investing smaller increments. Do your research and check out the fees. Verve Money offers no account or investment management fees for account balances under $1000 as a way of encouraging new investors to get comfortable with the process and give them the best opportunity to grow their investment portfolio.
- The best time to start is now – The great news for new investors is you don’t necessarily have to ‘dive right in’ and invest a large sum upfront, you can work your way up slowly and build confidence (and wealth) over time. Thanks to the power of compound interest, investing smaller amounts over a longer term can be more beneficial than waiting and investing a larger amount down the line. But as we mentioned earlier, just make sure you check out those fees on smaller account balances so your balance doesn’t get impacted with fees.
^ DISCLAIMER: All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,006 adults. Fieldwork was undertaken between 14th – 16th August 2023. The survey was carried out online. The figures have been weighted and are representative of all Australian adults (aged 18+).
This article is published by Verve Money Pty Ltd (ABN 71 653 669 366, AFS Representative No. 001294184), a Corporate Authorised Representative of True Oak Investments Ltd (ABN 81 002 558 956; AFSL 238184), as the Manager of Verve Money. A friendly reminder that all the financial information contained in this article is general in nature and does not take into account your personal financial objectives, situation or needs. It’s important to do your own research and consider getting in touch with a professional adviser to access specific information tailored to your unique situation.
You should read the Product Disclosure Statement, Investment Guide, Target Market Determination and Financial Services Guide before making a decision to acquire, hold, or continue to hold, an interest in the Verve Money Fund. Visit www.vervemoney.com.au/documents to view these documents.
Interests in the Verve Money Fund (ARSN 662 622 899) are issued by Melbourne Securities Corporation Limited (ACN 160 326 545, AFSL 428289). When considering financial returns, return of capital is not guaranteed and past performance is not indicative of future performance.