A recent survey showed 42% Surge in Women Investors in 2023 with 87% of them preferring Equity Funds, and the interesting aspect is that Women Save 5% More for Future Goals than Men...
Another trend is that Women's goal-based SIP investments show an impressive 19% lower stoppage rate, reflecting their long-term commitment to financial goals
An in-depth study among 3,763 women clients from the age bracket of 23 to 76 years in August 2023 on the occasion of Women’s Equality Day was carried out by a private investment management company FinEdge.
The study unveiled a remarkable 42% rise in women investors, saving 5% more for future goals than men. Notably, 30.82% of women prioritize retirement planning, signalling a major trend shift. Women also showed resilience in goal-based SIP investments, with a 19% lower stoppage rate, emphasizing their commitment to long-term financial goals."
Harsh Gahlaut, CEO, FinEdge said "We are delighted to see more and more women leading the way and helming their family's financial plan. Temperamentally, women make better investors than men as they are less speculative, and more purpose driven. This makes them excellent long-term investors as their resilience allows them to benefit from compounding. We are certain that this trend will gather momentum in the next 3-5 years”.
In regional breakdown, the West and North zones had strong female investor percentages at 34.54% and 32.98%, respectively. However, the East zone lagged with only 7.54% women investors."
Women have distinct financial challenges, requiring a unique investment approach
The study also aimed to uncover some of the key challenges mentioned below that women investors face on their wealth creation journey:
Career breaks for family care
Excessive risk aversion affecting returns
Distrust in sales-focused advisors
Limited awareness of key investing concepts
Confidence gaps due to traditional gender roles
More and more women are focusing on their own retirement
Retirement planning is gaining traction among women. A notable 30.82% prioritize it, second only to child education planning at 32.82%. This shift marks a new era where women independently plan for retirement or contribute equally to joint plans, ensuring financial resilience in unforeseen life events.
"Without a doubt, the increasing number of women who are entering the work force and excelling at their careers is driving the trend towards increased financial independence", said Gahlaut.
When guided properly, women embrace measured risk taking and benefit from compounding
Another interesting inference was that 87% of women opt for equity-oriented SIP investments, slightly below men at 89.9%. This This statistic is a clear indicator that the new generation of women investors are no longer shackled by their innate risk aversion. The average age of women investors was found to be 38.67 years, which was around 2 years less than the average age for male investors, which came in at 40.34 years.
Women are investing more than men for their goals, with clear and holistic goal-based plans
On average, women have 3.47 financial goals, while men have 3.74, showcasing a holistic approach. Women invest an average of Rs. 14,347 monthly, slightly higher than men at Rs. 13,704, challenging traditional assumptions. Notably, women show a 5% higher monthly savings rate for future goals. Additionally, women's SIP investments have a 19% lower stoppage rate, affirming their resilience as long-term investors."
Women’s investment management needs are unique, differ from those of men
FinEdge also conducted detailed feedback sessions with their investment experts who manage investments for women clients, to glean qualitative insights on what women look for in their investing platforms. The following factors topped the list:
Survey Methodology
The survey was conducted by FinEdge in the month of August this year. The sample is comprised of 3,763 women clients of FinEdge from the age bracket of 23 to 76 years. The study includes clients from across the region ranging from the West, East, North and South.
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