NEW YORK–(BUSINESS WIRE)–American women are feeling more optimistic about their financial futures
and confident about their money decisions compared with a year ago,
according to the latest Global Investor Pulse survey* (blackrockinvestorpulse.com/women-investors)
from BlackRock (NYSE:BLK). The survey also suggests that men and women
have lessons to learn from one another, particularly when it comes to
planning for retirement.
About half (51%) of women report feeling positive about their financial
futures, compared with 46% one year ago, and 42% say they are confident
they are making the right savings and investment decisions, compared
with 34% one year ago.
Both women (43%) and men (41%) put a high priority on saving to ensure
they live comfortably in retirement. But women are considerably less
likely than men to actually be saving for retirement (55% vs. 65%).
Perhaps as a result, women are more concerned than men (75% vs. 68%)
about their ability to meet their retirement goals.
“It’s clear that women need to become much more active in managing their
money toward urgent long-term goals – particularly retirement,” said
Heather Pelant, head of personal investing at BlackRock. “But our survey
also indicates that women have some key positive financial instincts
that can lend valuable support to their saving and investing efforts.”
“Gender Gap” Persists in Retirement Savings
On average, Americans of both genders have similar goals for an annual
retirement income, with men hoping to generate $45,956, and women hoping
to generate $45,018 each year.
However, according to the survey, women aged 55 to 65, who are closest
to retirement, have accumulated $118,000 in average retirement savings
that could provide $7,872 of estimated annual retirement income,
compared with men aged 55 to 65 who have accumulated average retirement
savings of $162,000, that could provide $10,807 of estimated annual
retirement income, according to the BlackRock CoRI
Despite the similarity in both expectation and shortfall, only 36% of
men express concern regarding their ability to achieve the annual income
goal they need in retirement. A much more realistic 52% of women
expressed the same concern.
The good news is that 51% of women indicated that they took advantage of
a workplace retirement savings plan to get started investing, compared
with 43% of men. “For women, workplace plans represent a critical step
towards their most important financial goals, suggesting that employers
need to keep the characteristics and needs particularly of women firmly
in mind in their efforts to help their employees become more effective
savers and investors,” said Heather Pelant.
Different Goals Drive Money Views
Women and men look at money and investing in quite different ways, the
Women tend to emphasize the day-to-day health of their household’s
finances. While 61% of women follow a household budget, just 23%
regularly review the performance of their savings and investments (vs.
33% of men) and women assign more importance than men to paying off debt
(55% vs. 46%).
Men also put a greater priority than women on growing their wealth (35%
vs. 28%, respectively) and holding on to their wealth (26% vs. 20%,
respectively). Men are more likely than women to say “I consider myself
an investor” (40% vs. 22%). They are more likely to hold stocks than
women and have less of their assets in low-return cash (60% of the
portfolio for men vs. 71% for women). Men also are more likely to say
that they enjoy managing their investments (46% vs. 26%). When asked how
the idea of investing makes them feel, men are more likely than women to
associate words like “hopeful” and “optimistic,” while women most
associated “nervous” and “risky.”
However, the survey shows that adopting a focus on growing wealth, while
a higher priority for men, can definitely help women. Among women who
have made wealth growth a priority, 63% have investments (vs. 38% who do
not make growing their wealth a priority), and they are twice as likely
to regularly put money into savings and investments.
Women: More Realistic, Inclined to Seek Help
Though less engaged as investors, women might be more sensitive than men
to the realities and requirements of successful investing.
Women are highly attuned to risk: The survey shows that they are
generally less inclined to take on investment risk to achieve financial
return and are more cautious about the future of the stock market. They
also are more likely than men to ask for advice for their investment and
savings decision-making (64% vs. 55%) and more likely to say they value
professional advice (74% vs. 64%).
“Overall, in deploying their money, women are more focused on managing
risks to their financial security and stability over the short term, and
men are more focused on achieving long-term money goals,” said Heather
Pelant. “In fact, American women and men have a lot to learn from
one another, as good financial and investment planning needs to reflect
Millennials: Breaking the Pattern?
In some ways, the money attitudes of younger women are diverging from
those of older women.
About three in 10 Millennial women (age 25 to 34) say they enjoy
managing investments, compared with just 21% of Boomer women (age 51 to
69), and 37% have prioritized growing wealth (vs. just 22% of Boomer
Unfortunately, just 53% of millennial women are saving for retirement
compared with 71% of millennial men, and they are considerably less
likely than their male peers to feel knowledgeable about investing.
Younger Women Intrigued by “Robo Advice”
Women are much less inclined than men to use online support for their
long-term savings and investment decisions. However, younger women might
be starting to bridge the “digital divide.”
For all Americans, the Internet is by far the most widely used source of
information for long-term financial decisions (used by 32% of the U.S.
population), but millennial men (43%) are more likely than millennial
women (35%) to use it. Thirty-three percent of American women, across
all generations, are most likely to turn to family and friends for
guidance on managing their finances.
Generally, men are more interested than women in “robo advisors” –
digital wealth management services that provide automated,
algorithm-based portfolio management advice – including 72% of
millennial men, vs. 45% of millennial women. That said, millennial women
express more interest in these digital platforms than women in any other
generation; for example, just 23% of women aged 55 to 64 are inclined
toward these services.
Millennial women who favor robo advice cite as benefits that they would
value the convenience and simplicity of the service in addition to the
perception that no one will be “pushing products” on them that they
might not need.
“For many investors, technology is playing an increasingly meaningful
role in their decision-making, either supplementing the advice of a
human advisor or representing a primary source of support,” said Heather
Pelant. “It’s encouraging that younger women are attuned to the
potential benefits of technology, because – as with many financial
habits – becoming comfortable with the role of digitally delivered
guidance early on can yield benefits throughout one’s investing life.”
BlackRock is a global leader in investment management, risk management
and advisory services for institutional and retail clients. At December
31, 2015, BlackRock’s AUM was $4.645 trillion. BlackRock helps clients
around the world meet their goals and overcome challenges with a range
of products that include separate accounts, mutual funds, iShares®
(exchange-traded funds), and other pooled investment vehicles. BlackRock
also offers risk management, advisory and enterprise investment system
services to a broad base of institutional investors through BlackRock
Solutions®. As of December 31, 2015, the firm had approximately 13,000
employees in more than 30 countries and a major presence in global
markets, including North and South America, Europe, Asia, Australia and
the Middle East and Africa. For additional information, please visit the
Company’s website at www.blackrock.com
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*About the Survey
BlackRock surveyed 30,500 respondents in 20 nations, including 4,000
Americans, on a broad selection of financial and investment management
questions. The US sample comprised 1,960 men and 2,040 women (for more
on the survey and its methodology, please visit www.blackrock.com/womeninvestors).
Sally Lyden, 1-646-310-1273