- Women More Likely to Focus on Immediate Financial Needs
- Overlook Planning for Their Retirement
Women around the world today are more concerned than men are about immediate financial needs and concerns -- and are more likely than men to overlook longer-term financial priorities such as planning effectively for their retirement, according to the first-ever Global Investor Pulse Survey recently conducted by BlackRock (BLK: NYSE). The survey, which polled more than 17,500 respondents in 12 nations including almost 9,000 women globally, is one of the largest surveys ever of its kind.
Women are more likely than men to emphasize strengthening day-to-day financial security via saving and debt reduction. When asked what they would do if they earned an extra $200 (or the equivalent) more per month, women globally were more inclined than men to say they would save more generally (45% vs. 38%) and pay off debt (28% vs. 23%) – as well as spend more on their children (15% vs. 11%).
At the same time, in most parts of the world, women (52%) are less likely than men (59%) to say they have begun to save for retirement.
In the U.S., both men and women prioritize retirement: 47% of men and 46% of women name “funding a comfortable retirement” as a currently important financial goal. But, while 55% of American men say they understand how much they need to save for retirement, only 45% of American women do. Just 53% of women say they have begun to save for retirement, compared with 62% of men.
Women Marked by "Sober" Financial Perspective
Worldwide, women are significantly more likely than men to choose a negative word (such as “nervous,” “pessimistic,” “frustrated,” and “concerned”) to describe their financial future (52% vs. 43%).
“Simply put, when it comes to money, women and men today see the world quite differently,” said Sue Thompson, Managing Director and Head of the Institutional Asset Management and RIA Channel at BlackRock. “Women have a profoundly sober financial perspective, apparently more influenced than men by the realities of today’s market volatility and ongoing economic uncertainty. They place greater emphasis than men on day-to-day financial planning and maintaining the household balance sheet -- but this focus also seems to undercut engagement around longer-horizon activities such as retirement planning as well as investment."
“Women seem highly realistic about the financial state of both the world and their own households. The research we’ve conducted with investors indicates that women’s more cautious stance yields healthy financial priorities, including urgency regarding saving and paying off debt,” said Anne Ackerley, BlackRock’s Chief Marketing Officer and co-chair of BlackRock’s Women’s Initiative Network. “At the same time, a confidence differential suggests that women still lack a sense of financial empowerment in certain key areas.”
Concern and Caution Drive Women’s Views of Money and Investing Globally
Around the world, women's financial conservatism is apparent in a far more cautious stance with their money as well as a wary stance toward risk.
More than half (55%) of women globally (compared with 47% of men) agree that “I am not willing to take any risks with my money,” and just 22% of women globally (compared with 34% of men) say they are willing to take on higher risks to achieve higher rewards.
Only 21% of women worldwide say they are comfortable investing in the stock market (compared with 33% of men).
Globally, Women Favor Financial Consolidation, Maintenance; Less Confident About Financial Decision-Making
The BlackRock poll shows that women view threats to household financial maintenance and sustainability more seriously than men do.
When asked to pick top threats to their financial futures, women are more inclined than men to name job security (31% vs. 25%) and having to spend more than they earned (35% vs. 27%).
Consistent with such concerns, women are more likely than men to cite the following as priorities: paying off the mortgage on their main home (30% of women vs. 26% of men), paying off other debts (49% vs. 42%), saving a deposit for a new home (15% vs. 11%), and financing their children’s education (21% vs. 18%).
“Globally, women’s financial worldview is differentiated by not only specific priorities and concerns, but also generally lower financial confidence levels,” said Ms. Ackerley. Only 15% of women globally (compared with 20% of men) say they feel “completely confident” about making the right savings and investment decisions.
Women are also less confident than men about their ability to achieve key financial priorities, including growing their wealth (66% of men vs. 55% of women are confident), preserving their wealth (71% vs. 62%), drawing an income from their savings/investments (69% vs. 60%), funding a comfortable retirement (65% vs. 52%), and paying for long-term care for themselves and/or their partner (59% vs. 43%).
"Engagement Gap" Looms Wide in the U.S.
In the United States, women clearly lag behind men in knowledge and use of some basic financial principles and products.
Compared with American men, American women are less knowledgeable and express less interest in saving and investing. Only 41% of U.S. women identify themselves as knowledgeable about saving and investing, compared with 57% of U.S. men.
U.S. women also lag behind U.S. men when it comes to financial engagement and autonomy. Only 48% of U.S. women report that they regularly monitor the performance of their savings and investments, while 59% of U.S. men do. And while 58% of U.S. men indicate that they feel comfortable making their own investment decisions, a mere 41% of U.S. women do.
Gender Disparities Less Evident Along the Pacific Rim
Along the Pacific Rim, women generally are more financially confident and empowered, and more closely aligned with men than their peers globally, BlackRock’s survey reveals.
Survey respondents in Taiwan and Hong Kong are more optimistic about their financial futures – with more unanimity between genders – than respondents elsewhere. More than half of Taiwanese men (57%) and Taiwanese women (55%) – as well as 67% of Hong Kong men and 62% of Hong Kong women – chose a positive word to describe their financial future.
When asked if they had started to save for retirement, men’s and women’s responses were more closely aligned in Hong Kong and Taiwan than anywhere else.
“The ‘gender story’ on the Pacific Rim shows that the differences that seem to set women and men apart in their money lives are not a foregone conclusion,” said Ms. Thompson. “With deeper understanding of the importance of balancing financial risk and opportunity as well as use of appropriate investment products, women can derive even more benefit from their sound money instincts – and sustain better progress toward their long-term financial goals, including a financially secure retirement.”
BlackRock’s Global Investor Pulse Survey, which polled 17,500 investors including 4,000 Americans in 2013, is one of the largest ever of its kind. The global survey sample included 8,984 women and 8,583 men; in the US, 2,074 women and 1,926 men were surveyed.
One of the largest global surveys ever conducted, the BlackRock Global Investor Pulse poll interviewed 17,567 respondents, in 12 nations: the US, Canada, the UK, Germany, France, Italy, the Netherlands, Belgium, Switzerland, Australia, Hong Kong and Taiwan. The US sample totaled 4,000 respondents. No income or asset qualifications were used in selecting the poll's participants, making the survey a truly representative sampling of each nation's entire population. Executed with the support of Cicero Research, the survey took place from Aug. 24 to Sept. 16. For both the global sample and the US sample of 4,000 respondents, the margin of error is +/- 3%.
The opinions expressed are as of March 4, 2014 and may change as subsequent conditions vary.