Women are building wealth not saving it
According to the Global Wealth Report (GWR), women now hold about 40% of the world’s wealth. In other words, they are tantalisingly close to achieving wealth equality with men. While this is, of course, cause for celebration, there are two key points to remember. The first is that in the GWR included non-financial assets, so it is probably safe to assume that at least some portion of this wealth relates to co-owned property, such as real estate. The second is that there can be huge variations in the level of wealth equality achieved by women in different parts of the world, even within different parts of the same country.
Economic and technological changes, may, currently, be working in favour of women
Even though 2008 is now, literally, over a decade ago, it still appears to be sending ripples through the global economy and those ripples may be helping to address the wealth inequality which has previously been standard in human society. In short, the effects of the crash have been felt very keenly in both finance and construction (and their related industries), both of which have long been male-dominated sectors. It has had less of an effect in areas such as education, health care, and administration (both public and private), all of which have typically been more female-dominated at least on the lower pay-grades. It will be interesting to see what impact, if any, the development of artificial intelligence will have on the industry in general and on the gender-difference in particular. On the one hand, industries which are very process-based should, in theory, be prime targets for automation, the only question would be when rather than if, but industries where there is a strong “human” element, for example, a need for traits such as empathy, would be very hard, if not impossible, to automate.
While women are wealthier they still appear to be saving and investing less than men
HMRC recently released figures regarding ISA usage by men and women. The figures revealed in (2016-17) found
that not only did men have more money in ISAs than women (an average of £3,611 or 14%) but they also tended to put their money into stocks and shares ISAs, whereas women were more likely to use cash ISAs. While the difference in the amount of money held in an ISA could simply reflect the fact that, on average, men still earn more than women (as demonstrated by the gender pay gap), the choice of ISA cannot necessarily be put down entirely to this, although it may be a factor as those on lower incomes may have a higher degree of concern about their ability to access their money quickly if they need to. One alternative explanation is that the fact that the financial-services industry is male-dominated (particularly at the higher grades) means that men have more of an opportunity to learn about the ins and outs of financial products than women do. Even if they do not work in the industry themselves, they may have a higher chance of knowing someone who does or of coming across content which is focused on meaningful saving and investing rather than just household budgeting. One way to test this theory would be for the financial services industry not only to try to recruit more women into its ranks (and particularly its senior ranks) but also to reach out to the mainstream press and social media influencers to try to educate women on the importance of both saving and investing for their future lives and goals and on the specific benefits of doing so in a tax-friendly manner such as within an ISA.
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