2023-10-30 11:57:54
Every year, World Savings Day on October 30th draws attention to the topic of investing – this year on October 30th. There are still some clear differences between men and women in saving and investment behavior, as revealed by a representative survey of 2,000 women and men in Germany commissioned by the asset manager JP Morgan Asset Management.
The result shows that current developments such as inflation and interest rate increases have a strong impact on women’s investment behavior. According to this, every second woman (49 percent) saves less or nothing at all due to high inflation – in comparison, the figure is 42 percent of men. As a result of the interest rate increases, 36 percent of women are again using daily money and savings accounts instead of investment funds, ETFs or stocks – for men the figure is 28 percent. Overall, almost every second woman currently uses a savings account, while among men it is only about one in three (36 percent). Only around one in four women are satisfied with the development of their savings products (26 percent).
“Inflation and interest rate increases have changed the framework conditions for investing. However, the actions derived from men and women are different. While many women feel compelled to act, for example by switching from stocks and funds to savings accounts and overnight money, men tend to stay true to their investment strategy,” says Beatrix Vogel from JP Morgan Asset Management in Germany. In her opinion, women in particular should ensure that they keep their investments in funds, ETFs and stocks for the longer term and not rely too heavily on current account and savings accounts.
Reserves for emergencies dominate among savings goals
When it comes to savings goals, both women and men currently prefer to play it safe: 52 percent of women save to build up reserves for emergencies, while among men it is 42 percent. Nevertheless, many women still want to remain flexible: 40 percent say that they save in order to be able to spontaneously fulfill their wishes – for men this is significantly less, at just 24 percent. And at least one in three women – as well as one in three men – saves to secure their retirement.
However, fears and worries can have a strong influence on saving behavior. Both women and men are particularly concerned that their savings will be gradually devalued by inflation (women: 49 percent; men: 51 percent). Almost every third woman and every third man are also afraid of a recession. The pressure to act appears to be greater for women than for men, as they are more likely than men to shift money from stocks, funds and ETFs to overnight money and savings accounts.
Savings accounts are clearly in the lead among women
When it comes to choosing forms of savings, savings accounts are clearly more popular for women – almost every second person has a savings account, significantly more than men at 36 percent. Many women also favor life or pension insurance (38 percent; men: 30 percent). Owning investment funds, ETFs and stocks, on the other hand, seems to be more of a men’s business – at 32 percent, they invest significantly more often than women at 21 percent.
However, satisfaction with the development of savings products leaves much to be desired, especially among women: only 26 percent of women say they are very satisfied or satisfied, in contrast to 37 percent of men. “The results show that the obvious pressure to act to rely more on savings products such as savings accounts and daily money does not lead to a satisfactory result for many women,” explains Beatrix Vogel. 29 percent of women attribute their dissatisfaction to the fact that interest rates cannot yet compensate for inflation, while another 14 percent say that the interest rate increases have not yet reached them.
When asked why they have not yet used capital market investments such as funds, ETFs, stocks or bonds, the differences between women and men are also clear. According to the survey, for women it is primarily their supposed ignorance that keeps them away from the capital market: While around 31 percent of women give this as a reason, the figure for men is only 19 percent. Women are also significantly more likely than men to lack the right advice; fluctuations and the associated possible losses are also a greater obstacle to women than men from investing in the capital market.
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“Women often have the feeling that they need to be particularly knowledgeable about capital market investments such as stocks and bonds. Knowledge is an important aspect of investing in stocks or bonds. But experience has shown that many women underestimate their knowledge, and it’s about basic knowledge, not expert knowledge,” says Beatrix Vogel. Supposed ignorance should therefore not become an obstacle for women to get involved in the capital market.
The results quoted here come from JP Morgan Asset Management’s 2023 Financial Barometer, a representative online survey via the Attest platform. Between June 26 and July 3, 2023, 2,000 women and men aged 20 and over in Germany were surveyed about their savings and investment behavior. In addition to the reasons and ways to save and invest, the effects of inflation and the interest rate environment were examined and the topic of financial education was considered. Last but not least, the focus was on current concerns and the perception of risk.
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