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Women are Better Investors than Men so Why are they so Worried?

Women are Better Investors than Men so Why are they so Worried?

June 04, 2024

Women are perceptive, capable investors, and yet, things like the rising cost of health and long-term care for themselves[1] and/or their spouses[2] have most of them worrying about running out of money in the future.

Are Women Really Better Investors?

Studies have shown that women are, in fact, better investors than men.  When they invest, women enjoy 1.8% higher returns, on average, than men do.  This is likely due to the fact that men are more willing to put all of their eggs in one basket for the possibility of near-term gain, while women tend to have a more long-term perspective[3].  Author Meredith Jones argues that women have a greater tolerance for standing firm in the face of market noise, and a more consistent application of investment strategy.[4]  Ironically, it seems women do better in the market for the same reason they are more worried:  they are more likely to focus on the long term. Successful investing is future-oriented.  As a practicing financial advisor, I know that ANYTHING that enhances a person’s ability to patiently stick to their plan is powerful.  So, if estrogen contributes to patience and a long-term perspective, I say bring it on!

If women are better investors, should they be as worried as they are? 

Unfortunately, yes.  Though women are inclined toward more productive and fruitful investment strategies, and they see better returns when they invest, women in general are not well prepared for retirement.  Due to various factors, on average, women make 22% less money than men over the course of their lifetimes.  However, they accumulate roughly 66% less wealth (i.e. net worth) than men.  Why is 22% less earnings equating to 66% less wealth?  This significant disparity is likely due to the average woman spending significantly more of her adult life outside of the workforce, than men.[5]  One of the main reasons for this difference is caregiving.  Women are far more likely to take time off work to care for children, parents, and/or spouses.  Caregiving is necessary, it costs money, and it rarely allows for earning and saving.  It also has an impact on caregivers’ health; keeping them from playing catch up once the caregiving season is over[6].

This is in no way meant to disparage or discourage women (or anyone) from engaging in caregiving.  Caregiving is a good, worthy, and NECESSARY endeavor.  These facts are meant to highlight the degree to which women have a RIGHT to be concerned.  Statistics show they are worried for very good reasons.  The cost of health, caring for others, and inability to earn is likely to fall on them.

In spite of these very justifiable concerns, women are unlikely to seek help in the form of financial advice.  Studies show that 85% of women would rather talk about their own death than their finances![7] This is particularly interesting because every man reading this, if he’s honest, will admit he would rather talk about money (or anything) rather than his own demise!  Though the burden of caring for family falls mostly on them and creates a great deal of concern for future well being, less than half of women believe they have an influence when it comes to investment decisions, and 1/3 of women don’t believe they have the knowledge necessary to be more involved. Only 28% of women report feeling empowered to act on their own finances.  This is particularly interesting when you consider that only 27% of women believe that men are more knowledgeable about investing than they are[8].  Women don’t appear to be confident in their own abilities OR men’s.  No wonder they’re so worried!

It's Still Tough to be a Woman

American culture has changed drastically in just a few generations. Women have more options available to them than ever before.  They are excelling in a wide range of professions, the wage-gap is continuing to narrow, and yet, it’s still tough to be a woman.  Women have gained greater independence and greater earning power, but they’re still doing the necessary work of caring for loved ones.  It appears many women are just “wearing more hats”.  They’re working and sacrificing in business and at home.  They’re also still uncomfortable when it comes to investing in their future.  This combination leads to justifiable worry and concern.

While we may not be able to prevent women from wearing too many hats overnight, there are important steps women (and the men who care about them) can take now to empower them to take charge of their finances.  Recall that women tend to be better investors because they more readily think about the long-term and patiently stick with their plan.  That means, once women ARE invested, they have a greater capacity, on average, to make consistent (i.e. better) investment decisions.  So, what can women do to develop enough confidence to get into the investing game, and put their “superpowers” to work?

We’ve all heard the phrase “knowledge is power”.  One of the quickest ways for women to build confidence in their investing ability is knowledge.  Gaining knowledge and building a support network are some of the best ways to gain confidence in any area.  One of the best ways to do this is to partner with a financial advisor.  I know I’m biased, but the data is so clear!  Individuals who work with financial advisors report higher levels of investment knowledge and confidence.  They also report a higher acceptance of risk, which can be particularly helpful for those who naturally want to err on the side of caution[9].

Caring for others and having a secure financial future should not be a one-or-the-other kind of decision.  I want to see women empowered to maximize their investing potential while they are able to earn a good income, so they can care for others without concern for their own wellbeing when it’s time.  I also want to see women empowered to get involved in financial conversations with their significant others, so that both spouses’ future concerns are addressed.  While it’s still tough to be a woman, female investors can look to the future with confidence.  Women have the unique ability to stick to a long-term strategy.  This superpower paired with a capable financial advisor has the potential to help women develop the education and confidence to overcome some of the unique challenges they face so they can enjoy a future free of financial concern.

[1] National Council on Aging. (2022). Women living in and preparing for retirement. Access online on May 20, 2024 from

[2] National Institute of Retirement Security. (2024). “What do women think about retirement.” Accessed online on May 20, 2024 from

[3] Steward, Neil. (2018). “Are women better investors than men?” Accessed online on May 20, 2024 from

[4] Jones, Meredith. (2015). “Women of the street: Why female money managers generate higher returns.” Springer.

[5] Merrill Lynch (nd). Women and financial wellness: Beyond the bottom line. Accessed online on May 20, 2024 from

[6] National Council on Aging. (2022). “Get the facts on women and aging.” Aging in America for Advocates.  Accessed online on May 20, 2024 from

[7] Merrill Lynch (nd). Women and financial wellness: Beyond the bottom line. Accessed online on May 20, 2024 from

[8] Bank of America. (2024). “Women, money, and confidence: A lifelong relationship.” Accessed online on May 20, 2024 from

[9] Shue, M., & Watkins, M. L. (2023). Women & investing: A stronger grip on their financial futures. Accessed online on May 20,2024 from