– 43% of women who save at least £100-a-month say they have been put off investing because there are too many funds to choose from
– Nearly three quarters (70%) of women say security of getting their original investment back is more important than achieving big returns, which may help explain why there are fewer female investors
– Four in ten (40%) women are unaware you can save into more than one type of ISA in the same tax year
More than 2.6 million women have been put off investing because of the number of funds on offer, according to new research from Scottish Friendly.
Figures reveal more than four in ten (43%) – or 2.64 million* – women who save more than £100-a-month have avoided investing because they were discouraged by the vast number of funds available in the market. This compares to just 27%, or 1.67 million, men.
The research backs up the latest figures from HM Revenue & Customs (HMRC) showing a significant gap in the number of men and women who hold stocks and shares ISAs.
At the end of the 2015/16 tax year, more than 1.1 million men subscribed to a stocks and shares ISA, compared to just 892,000 women, HMRC found.
Separately, Scottish Friendly’s findings suggest women are less likely to put their money at risk than men, another potential reason why there are fewer female investors.
Seven in ten (70%) women say that getting back their original investment was more important to them than chasing higher returns, compared to 60% of men who said the same.
The research also reveals that four in 10 (40%) of women are unaware you can save or invest into more than one type of ISA at a time, compared to 30% of men.
Jill Mackay, Head of Marketing at Scottish Friendly, said: “It has been well trailed that we need to save and invest more in the UK. But it is particularly concerning that women, in general, are less likely to invest than men. While the financial services sector has long pledged to tackle this issue, it is clear that more needs to be done to better engage with female savers to help them achieve financial security.
“We understand that investing can sometimes seem scary, but it needn’t be. Yes, there are risks involved but if you invest for the long-term, the potential for higher returns could be increased. And remember, you can invest in more than one ISA, for example both a cash and a stocks and shares ISA, in the same tax year.”
Below, Henrietta Oxlade, independent financial planner at Radcliffe & Newlands, sets out some top tips for first-time investors:
- Make sure you have an emergency fund in cash savings before you start investing. This is so you have money that you can easily access if the boiler breaks down, for example.
- Invest for the long term – gains are made over years, not months, so aim to keep your money invested for at least five years. That way, it will also allow your savings time to recover if there is a dip in the stock market.
- While it is completely normal to be worried about investment risk, be aware that without risk, there is no reward and savings goals do not get achieved by keeping money in the bank.
- Never invest in something you do not understand – if you can’t explain an investment opportunity to a loved one, then avoid it. Investing in things we know little about is nearly always a sure-fire way to lose money.
- And my top tip? Do not look at your investments every day, otherwise you can become obsessed with the daily movements. It’s a bit like weighing yourself: it’s the long-term trend that matters, not the small fluctuations along the way.
With all stock market investments, your investment can go down as well as up, so you could get back less than you invested.
Our consumer survey was conducted by OnePoll between 04/02/19 and 08/02/19. The total sample size was 2,000 UK adults who save at least £100 a month. The sample is nationally representative by age, region and gender.
*Number of women in the UK saving £100 a month – 22.8% (Total number of women saving more than a £100 per month based on the United Kingdom Household Longitudinal Study, UK Data Service)
x 26.65 million (Population of women aged 18+ in the UK according to the ONS) = 6.1 million.
*Number of women put off investing by the confusing number of funds – 43.3% (Percentage of women who say they have been put off investing by the confusing number of funds) x 6.1 million = 2.64 million