Are women shooting themselves in the financial foot?

Written by
Holly Mackay

28 Jul 2016

28 Jul 2016 • by Holly Mackay

As “Breaking the Glass Ceiling” becomes an increasingly popular topic, we are championing more women to lead in the boardroom, in politics and in technology – so why is money still a taboo subject for so many women?

Our recent survey shows that there is an astonishing gap between the number of men and women when it comes to savings, pensions and investments - largely because women are too nervous about the risks to dip their toe in the water. A shocking 85% are disengaged with the stock market and only 10% of us have a stocks and shares ISA.

Value of investing

I am often contacted by women who don’t know where to start with their savings, yet are fed up of low interest rates or are worried about not having a strong retirement fund.

A lot of women I speak to just don’t see themselves as investors or don’t think they’re smart enough to get involved – despite studies actually showing that women typically make better investors than men! Many women see investing in stocks and shares as a bit like gambling, but in fact, over ten years, shares are likely to outperform cash savings by 90 percent!


Women typically save 38 percent less than men. No surprises here as we still fight a gender pay gap and juggle families and careers. We know that the average retirement income of a woman is likely to be around £5,000 a year lower than a man’s. But with women living around four years longer on average than men, they actually need to find an additional £100,000 to fund a retirement income of £25,000 a year.

Whilst the stock market isn’t for everyone, I’d like to tackle women’s questions in normal language, with realistic amounts and with quick steps which don’t have to take ages and make you lose the will to live on the way!

Looking forward

You’ll likely get your State Pension when you’re 67 or 68. And if you haven’t got a full 35 years’ worth of National Insurance contribution it will be less than the full £155.65 a week.

Fortunately, if you are aged above 22 and earn at least £10,000, new government initiatives mean employees will automatically be enrolled onto a workplace pension by 2018, which will include contributions from you, your employer and the Government by 2019. This is kinda enforced saving but the extra top ups make it good news. This means a 40-year-old earning an average wage of £30,000 a year today can expect to have saved – with all sort so assumptions which we detail on our website - the equivalent of around £150 a week for their retirement to add to the State Pension pot.

If you can get your head around a private pension too, it can be a great way to top up that pension pot. Private pensions can be set up from as little as £1 a day and stocks and shares ISAs can be arranged in 10 minutes, with a monthly direct debit of just £25 – far less than most people expect. If you’re a basic rate taxpayer, for every £80 you chuck in, the Government will add another £20 on top. That’s basically free money!

The other thing to remember is that loads of companies now make what I think of as investment ‘ready meals’. You do a simple online quiz and out pops a ready-made investment portfolio which removes the need to be a maths geek.  I like Bestinvest, Fidelity and Hargreaves Lansdown for these DIY online pensions.

If pensions feel too far away then consider a stocks and shares ISA too – but only if your time horizon for that stash is 5 years or more. Charles Stanley have a cheap online ISA, as well as the above names. Do have a look online for some more tips and ideas – why should boys have all the funds?!