Tara Tyan, the Regional Head of Marketing at Saxo Bank, explains why women need to start investing as soon as possible.
GCC countries are pushing the female empowerment agenda, with governments advocating for an increase in positions for women in the private and public sectors.
In the UAE, women comprised 80 per cent of the science team and 34 per cent of the successful Hope Probe mission to Mars. In Saudi Arabia, the country has seen an increase of 282 per cent in women working in public and private sector positions in 2020 alone.
With this drive for gender equality, women now have broader options available to them, and more opportunities to take control of their financial future. A recent survey conducted by Fidelity found that women save more than men, around nine per cent of their annual salary compared to 8.6 per cent for men. One way they can take control of their financial futures is through investing.
Here are three very real reasons why women should invest today.
Investing is the only option if you don’t want your assets to diminish
With interest rates on savings at around zero per cent, and inflation around three per cent globally, investing is not only necessary to grow your assets, but in the first place to avoid the diminishing of these assets.
Research shows that not participating in the stock market for retirement and other savings yields a welfare loss of 12 per cent. With the interest rates around 0% or even negative figures, investing becomes even more important to grow your money than ever before.
You work hard, so why not make your money work as hard as you do by investing?
One of the most important ways to take care of one’s financial future is to make sure your money is working as hard as you. By earning interest on a savings account, dividends from holding stocks or rent on investment properties, the money that you make by savings and/or investing in stocks or real estate are passive income, when your money works for you while you ‘sleep’.
In 2020, Saxo saw a 354 per cent global increase in new female investors compared to 288 per cent for men – this is very encouraging. However, the split between female and male investors can be closed further. The investment gap is one that women can solve themselves, without the help of others, by taking action, today. Do your homework, make a plan and stick to it and you will thank yourself later. This is a straightforward way to significantly improve the financial lives of women.
Women live longer, and need more retirement funds than men
While earnings for women are in general less than for men, according to the World Health Organisation, women live on average six to eight years longer than men. That means that if women want to have additional funds available at retirement, women need to have a bigger amount available than men, to cover for a larger number of retirement years.
Overall, the journey to financial freedom isn’t easy – it’s long, requires a lot of attention, focus and determination. But in the end, it’s worth it. By investing regularly, we diversify our income streams with a supplement on our income or retirement. This will not only benefit ourselves but also can benefit our loved ones. It will be full of challenges and the strategy must be adjusted as our lives naturally evolve. But it is a very powerful, worthwhile, and empowering journey to embark on, so start now.
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Feature image: Unsplash @joshuamayo