Figures published recently by Professional Adviser highlight the persistence of a so-called “gender investment gap”.

While more ISAs are opened by women than by men, only 35% of young Stocks and Shares ISA investors are women. These figures appear to contradict the results of a 2021 Women and Investing Study from Fidelity, which suggested women were keener to invest post-Covid and that female investor numbers were on the rise.

Cash ISAs, meanwhile, have seen huge inflows during the 2023/24 tax year so far. According to Money Marketing, UK savers moved more than £9 billion into Cash ISAs in the first three months of this tax year alone. This marks the biggest inflow since ISAs launched in 1999.

More than half (54%) of Cash ISAs are opened by women.

Keep reading for your look at the gender investment gap, the reasons for it, and why switching to investments could be the right move for you.

Cash rates are improving but investment still offers the long-term prospect of higher returns

High street bank and Cash ISA savings rates have improved over the last few months as providers pass on the rises to the Bank of England (BoE) base rate.

Since December 2021, the base rate has risen from a historic low of 0.1% to 5.25%, after 14 consecutive rises by the central bank’s Monetary Policy Committee (MPC) and one “stick”.

Inflation, meanwhile, has fallen from its October 2022 peak – a 41-year high of 11.1%. But the Consumer Prices Index (CPI) is falling more slowly than expected. It might not return to the BoE’s own 2% target until Q2 2025.

According to This is Money, the best rate available on a Cash ISA (as of 6 October 2023, excluding those accounts offering bonuses) is 4.9%. 

After two and half years of rising and high inflation, during which cash savings have been effectively losing their value in real terms, cash holdings aren’t out of the woods yet.

The general trend of the markets, meanwhile, is an upward one. Here’s the FTSE All-Share Index since January 2020:

Source: London Stock Exchange

A long-term investment, linked to your long-term goals and aspirations, and your risk profile, offers the potential for better returns than cash savings.

Female investor numbers are reportedly on the rise but the gender gap remains

While Professional Adviser’s report on Stocks and Shares ISAs paints a worrying picture, Fidelity’s 2021 Women and Investing Study is more encouraging.

The report into the investing habits of American women found that 50% became more interested in investing post-pandemic. This has led to a rise in female investors, from 67% of women investing outside of retirement now, compared to just 44% in 2018.

While Professional Adviser states that the gender gap narrowed as investors got older, Fidelity suggested that younger women were leading the charge, with 71% of female investors classed as millennials. This compared to just 62% who were baby boomers (born between 1946 and 1964, so aged 59 to 77 currently).

Despite a growth in investor numbers, confidence is still an issue. Just 33% of women see themselves as investors, while only 14% would commit to agreeing with the statement, “I know a lot about saving and investing.”

This lack of confidence could well be misplaced. Fidelity analysis of more than 5 million of their customers over the last decade found that, on average, female investors outperformed their male counterparts by 0.4%.

More than two-thirds of women (69%), meanwhile, wish they had started investing their extra savings earlier.

Financial advice can help to break down the barriers facing female investors and bridge the gender gap

Back in January, we looked at the effect of menopause on retirement prospects when we wrote ‘How to bridge the menopause retirement gap in your business’ and highlighted other important reasons for gender disparity. 

These factors include:

• A higher proportion of female part-time workers
• Time spent out of work to start a family
• Traditional gender roles casting women as primary caregivers
• The gender pay gap that sees women earn 35% less on average.

While the battle to bridge the gender retirement gap means that women need to concentrate their efforts in this area, there is room for investing outside of a pension too. Professional financial advice and guidance can help here.

In May 2023, FTAdviser confirmed that 66% of advisers currently see their main role as providing reassurance. This is largely due to the continuing cost of living crisis, alongside wider concerns about the UK’s post-Covid economic recovery and volatility in global markets.

A carefully conceived financial plan, aligned to your long-term goals, and based on your risk profile, can help you invest with confidence. With a risk-managed portfolio in place – regularly reviewed to check if rebalancing is required – you’ll have a sense of control over your future.

Working with Boolers’ team of experts also means you’ll benefit from our decades of experience in the markets.

We’ll be on hand to offer much-needed reassurance, to help you stay calm when markets are volatile, and to ensure you’re still invested when prices recover. 

Get in touch

Together, the strategies we put in place, and the ongoing relationship we nurture, can help you to gain confidence and achieve your investment goals.

If you’d like help, contact us with any questions you have about investing, or your wider long-term financial plans, and see how our team of dedicated professionals can help you. 

Please note

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.