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The gender investment gap in the UK has widened with more young people choosing to invest while women hold on to cash due to a lack of confidence, a survey has shown.
Investment research house Boring Money found that the gender investment gap rose by £54 billion to £567 billion between January 2023 and January 2024. Men invested £1.01 trillion compared to £450 billion for women. The figures include personal investments but do not include workplace pensions.
This difference increased due to more men aged between 25 and 44 investing their money in work for the first time compared to women in the same age group, according to the study, which questioned 6,486 adults across the United Kingdom. Young women also tend to be risk averse and less confident in investing compared to their male counterparts.
“The gender investment gap remains stubbornly and frustratingly high and will get worse in 2024,” said Holly MacKay, CEO of Boring Money. “Shockingly, it is higher than the GDP of Poland or Argentina.”
Only 19 percent of women ages 25 to 44 were investors in January 2024, up one percentage point from the previous year. Meanwhile, the proportion of British men of the same age who invested rose from 28 per cent to 34 per cent.
The gap is most pronounced for people between the ages of 18 and 24, where 9 percent of women invest compared to 22 percent of men.
In Scotland and Wales, men under 44 are three times more likely to invest than women.
The average amount held by male investors is £102,000, compared to £66,000 for women. If invested amounts were distributed by gender across all men in the UK, men would have on average £40,000, while women would have £16,000.
The survey also highlighted differing attitudes towards risk, with women of all ages – even those who invest – being less tolerant of it than men. Only 18 percent of women choose a high-risk pension compared to 33 percent of men.
This decrease in risk appetite, as well as lower average wages, prompts women to hold more of their assets in cash. Female investors keep 29 percent of their assets in cash, compared to 25 percent for male investors.
“This gender gap emerges at an early age, even before the typical causes of child care and wage gaps become apparent,” MacKay said.
“Our research has found that with this younger group, it's all about trust, brand awareness, social norms and expectations of what an investor looks like.”
Women are also more likely to seek financial advice from their mothers than from their fathers, according to data from Hargreaves Lansdowne published on Tuesday. A quarter of women say their parents had the greatest influence on their attitude towards money, and of these, 35 per cent said their mother had the greatest influence.
Only one in three said their relatives taught them about investing when they were growing up, compared to two in three who said their families taught them about personal finance, such as budgeting.
