Are Men and Women Really Equal When It Comes To Investing Money?
Shweta is an ambitious and diligent 34-year-old working woman from Bangalore, India. She is married and manages 2 kids, 1 family, and a team of 8 people at her work, all by herself. She is a delivery manager in a well-known IT company where she plans the develops the project idea, makes presentations, monitors project progress, sets deadlines, fixes bugs, ensures stakeholder satisfaction, evaluates performance, keeps up with tech trends, what food to make and which math table should her kid memorize for the weekly test. Despite being capable and proactively involved in all the day-to-day activities, she misses on one of the most important aspects of life, which is managing her money and finance.
The Divide
Paytm the no-need-to-introduce fintech unicorn of India did a social experiment named ‘The Divide’ ahead of International Women’s Day the last year 2021. The ad was made to highlight the financial literacy gap between men and women involving 30 people of different ages and backgrounds. The participants of the experiment are asked to step forward for every ‘yes’ and to take a step back for every ‘no’. From initial simple questions like if they learned how to ride a bicycle before the age of 10, the questions then start to focus on finances and money. It’s terrific how the end shows that the front line consists only of men, while all the women are behind.
Watch the video for a better understanding.
Disturbing numbers.
33% of women in India do not invest at all and the number is as high as 40% in the 21-25 years age group. Overall, 55% of women in the country are either not investing or are unaware of their investments. Women have got good saving habits and attention to detail, two very important qualities for wealth creation, in their genes. It is a deadly combination actually. Despite these innate strengths essential for money management many women end up just saving and not investing. And the majority of the ones who choose to invest, go for traditional options like gold jewellery and fixed deposits, 42% and 35% stating as their top choices respectively, not adequate enough to hedge against inflation and build to build wealth for themselves.
India, the sixth-biggest equity market globally, ranks in the bottom quartile when it comes to female participation in the stock markets. While the investment arena in the world is male-dominated, the gender gap in India is wider, with women making up just 21 out of 100 investors.
You are not alone.
The above situation is not just true for Shweta but for many Indian working women like her. Be it IT professionals, bankers, accountants, doctors, chefs, or any other domain. The main reasons for women not investing money in stock markets are lack of time, proper financial knowledge, and the fear of losing their savings. Today, with technological advancements and more awareness in the field of finance, seeking professional help is just a matter of a few clicks.
However, one of the major problems lies in the mindset of people. A lot of women fear seeking help and assistance when it comes to their savings. They are willing to pay making charges, and locker charges for gold jewellery; they will settle for peanut interest rates on bank deposits, but won’t pay a 2.5% to a money manager who can use his/ her expertise in the domain and make the equity investing process smoother. And the fault isn’t entirely theirs. It needs an empowered society to empower women to a level to be able to make wise and informed money decisions by themselves, for themselves.
Seeing the silver line.
The above facts and figures portray a terrific scenario for women like Shweta in investing. But women have broken the glass ceiling in all spheres of life, be it politics or education. Despite the economic downturn post the outbreak of the COVID-19 leading to job losses and pay cuts, one of the positives to emerge was the increasing participation of women in equity investments. Women function as investors and not traders when it comes to stocks. Hence, many millennial women invested in fundamentally-strong stocks available at a massive discount during the lockdown.
Why equities for women?
Traditional options like gold jewellery and fixed deposit, as discussed above are the most preferred investment choice for many women. However, such options do not generate more than 5% per annum in returns. The average inflation rate in India is 5.95% in the last decade. Also, not to forget, that FD interests and physical gold come with a tax burden. It means these financial vehicles are working in their first gear, not properly aligned with your goal to reach the destination of wealth creation. Investing in these options is a sure-shot way of eroding your hard-earned money rather than creating it. On the contrary, if history is any proof, equity is the only asset class that has outperformed all its counterparts over the last 125 years. Allow us to demonstrate the compounding magic of investing in Sukhanidhi’s elite quality portfolio.
Do you want to create wealth by investing in equities? Get in touch with Sukhanidhi Investment Advisors and get a high-quality direct equity portfolio built based on your long-term financial goals, investment time horizon, and your risk-taking ability to consistently generate inflation-adjusted, risk-adjusted, and tax-efficient returns across business and economic cycles at very minimal risk.
Way forward.
“Teach her about how money really works, and she can change the world.” We are going well but not better. The task is to bring more women like Shweta into the equity investing game. The easiest and safest way to go about the idea for Shweta will be to read and understand more about equity instruments and seek help from Sukhanidhi Investment Advisors for better clarity and planning of long-term financial goals.
Wait no more, you powerful women of the country, and start your investing journey today. Because you can. Ditch all the fear for it’s no rocket science.
Happy investing!
Warm Regards,
Financially aware women’s team at Sukhanidhi Advisors.
About Sukhanidhi.
We at Sukhanidhi are on a massive mission to help 1000+ Indian women in starting their wealth creation journeys and getting completely financially independent by faithfully adhering to a safe & sensible investment approach. We are experts in the domain of quality investing and do not indulge in any risky affairs like momentum trading, debt investments, derivatives, technical analysis, and timing the market.
About Author
Vinayak Savanur
Founder & CIO at Sukhanidhi Investment Advisors, a SEBI registered equity investment advisory firm. He has nearly a decade of experience in the stock markets and has been a holistic financial planner.
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