Women investors: gathering your confidence

It's a conundrum: Several major studies suggest that women are interested in investing, make well-considered investment decisions and are largely responsible for managing their family's finances and balancing household budgets. Yet more often than not, among couples, the man still handles the investments, and women still feel less confident than men about making investment decisions.

On its website (www.fiscalagents.com), Fiscal Agents Financial Services Group, an Oakville, Ontario-based full-service savings and investments centre, discusses a U.S. survey that shows 62 per cent of women balance the couple's cheque book and 58 per cent pay the household bills — but just 15 per cent are solely responsible for making investment decisions.

This seems unfortunate when compared to the results of another study by researchers at the University of California. The study examined the investment records of 35,000 households with accounts at local brokerage houses throughout the 1990s. It found that men turned their portfolios over more frequently than women did — and tended to have lower returns at the end of the year than women.

According to Fiscal Agents, women want more detail than men about the investments their advisors propose. "A poll conducted in the U.S. in the late 1990s found that women spend 40 per cent more time researching a mutual fund before they invest. What's more, they tend to be less impulsive and less inclined to act on a hot tip than men are."

Yet — and here is the irony — the poll also found women to be less confident in their investing abilities than men. "Only 56 per cent of women feel confident about their investing abilities versus 64 per cent of men."

Women need more savings
A second irony is that when you look at the numbers, women actually need to be more confident — and more skilled — than men when it comes to investing.

Generally, women still earn less than men for work of similar scope and value. They may also leave the workforce for a decade or longer while their children are young, or for several years later in life to care for aging parents. As a result, they may work less and have less disposable income to contribute to RRSPs. They may also end up entitled to less income from the Canada or Quebec Pension Plan because they contribute less to it during the course of their working lives. Some women spend their lives raising families and don't work at all.

Then, to top it all off, women are statistically likely to outlive men by several years, so they actually need their retirement savings to last longer than men's.

Whether you're married or single, divorced or widowed — starting your career or approaching retirement — the time to get more involved in your investments is now.
Here are some ways to become more knowledgeable:

• Read books, websites and newspaper articles about investing.
• Attend free seminars and presentations offered by banks and insurance companies.
• Consider taking the Canadian Securities Course, offered by the Canadian Securities Institute (www.csi.ca).

And of course, talk to your advisor about ways to become more informed and involved when it comes to your own investments.

Downloads

Women investors Gathering your confidence