Extremely enlightening artcile Why Dont Women Make Investment Decisions? Why is it that men are overwhelmingly more likely to be in charge of a familys savings and investments... By Dhirendra Kumar | Mar 7, 2014 Yesterday was International Womens Day. Over the last couple of years, much of the related public discourse has been focused on womens safety, for obvious reasons. However, when you dig deeply, many of the issues boil down to empowerment in an everyday sense, and one of the issues underlying empowerment is often money. The obvious problem here is that women in general earn less than men, often a lot less. However, thats just one part of it. There is another dimension to this. Even when women earn well, and even when they belong to a milieu where there is no overt discrimination, they are less likely to be managing their own money, their savings and their investments. Leaving out those who are in a financial profession, it seems that investments is something that women just dont do. This is painfully clear in the emails that we get at Value Research asking for investment advice. There are men who ask for advice for their finances and there are men who ask on behalf of themselves and their spouses. However, there are practically never any women who write in for advice for their own finances, and absolutely never any who ask for advice for their familys finances and investments. This state of things wouldnt come as a surprise to anyone but we need to pause and question it a little deeply. What exactly is the reason? The obvious answer is that in families, its the men who manage savings and investments. But that simply restates the problem in different words. From the few women who do write in, I think theres another problem, which is that of self-confidence. When women write in to ask for savings advice, the language is basically along the lines of This is probably a stupid question, but…. You see the problem here? There must be many more who thought of asking something but didnt want to be thought of as stupid so ended up not writing in. Meanwhile, men blithely write in asking questions and learning from the advice, regardless of their level of stupidity. This phenomena is actually just a variation that women face often enough in their professions. However, when it comes to investments, theres a different set of stereotypes at work. Theres the basic assumption that men are the savers and investors while women are the spenders. This is incredibly widespread and not just in a traditional background. Watch the ads on TV. There are plenty which show women as the wise and smart and sensible decision maker and men as the impulsive ones. However, these are all likely to be in things like nutrition or consumer goods and such. When it comes to ads that are about financial products, you see the reverse. The wise and foresightful husband plans for the future while the woman is buying LCD TVs etc. So how will this change? I for one dont think that any kind of top down, patronising solution (an investment equivalent of a womens bank, for instance) is going to work. Nor are the bizarre specially for women bank accounts--theyre just marketing gimmicks. Money is power, and that power extends not just to earning money but managing it, investing it and having a say in whats done. This kind of power is something thats transferred not when someone who has it gives it away but when someone who doesnt have it steps up and acquires it. At the end of the day, theres no difference between men who dont know enough about personal finance and women who dont enough. Both are a majority. And theres no separate mens and womens solutions to this. Regardless of gender, there are plenty of resources out there to educate oneself and pull ones level of understanding up by the bootstraps, as it were. Its sounds like a tough job, but there it is. This column first appeared in March 2013.
Posted on: Sun, 09 Mar 2014 08:01:46 +0000
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