A Paradigm Shift in Wealth Management-42% Surge in Women Investors in 2023, 87% Women Prefer Equity Funds, Women Save 5% More for Future Goals than Men

• 42% increase in women investors, up from 18% in the company’s inaugural year
• On average, women investors are saving 5% more per month for their future goals compared to men
• 30.82% of women named retirement planning as their top priority goal, marking a significant shift in financial planning
• Women’s goal-based SIP investments show an impressive 19% lower stoppage rate, reflecting their long-term commitment to financial goals

FinEdge, India’s leading tech enabled investment management company, conducted an in-depth study among 3,763 women clients from the age bracket of 23 to 76 years in August 2023 on the occasion of Women’s Equality Day.

The study unveiled a remarkable 42% rise in women investors, saving 5% more for future goals than men. Notably, 30.82% of women prioritize retirement planning, signalling a major trend shift. Women also showed resilience in goal-based SIP investments, with a 19% lower stoppage rate, emphasizing their commitment to long-term financial goals.”

Mr. Harsh Gahlaut, CEO, FinEdge said “We are delighted to see more and more women leading the way and helming their family’s financial plan. Temperamentally, women make better investors than men as they are less speculative, and more purpose driven. This makes them excellent long-term investors as their resilience allows them to benefit from compounding. We are certain that this trend will gather momentum in the next 3-5 years”.

Percentage of women in new client mix is on an explosive growth track

Since its 2012 inception, the company’s female clientele grew from 18% to an impressive 42%. Over the last three years, women clients increased by 50%, and FinEdge foresees this number surpassing 50% by 2024.

In regional breakdown, the West and North zones had strong female investor percentages at 34.54% and 32.98%, respectively. However, the East zone lagged with only 7.54% women investors.”

Women have distinct financial challenges, requiring a unique investment approach

The study also aimed to uncover some of the key challenges mentioned below that women investors face on their wealth creation journey:

• Career breaks for family care
• Excessive risk aversion affecting returns
• Distrust in sales-focused advisors
• Limited awareness of key investing concepts
• Confidence gaps due to traditional gender roles

• More and more women are focusing on their own retirement

Retirement planning is gaining traction among women. A notable 30.82% prioritize it, second only to child education planning at 32.82%. This shift marks a new era where women independently plan for retirement or contribute equally to joint plans, ensuring financial resilience in unforeseen life events.
“Without a doubt, the increasing number of women who are entering the work force and excelling at their careers is driving the trend towards increased financial independence”, said Gahlaut.

• When guided properly, women embrace measured risk taking and benefit from compounding

Another interesting inference was that 87% of women opt for equity-oriented SIP investments, slightly below men at 89.9%. This This statistic is a clear indicator that the new generation of women investors are no longer shackled by their innate risk aversion. The average age of women investors was found to be 38.67 years, which was around 2 years less than the average age for male investors, which came in at 40.34 years.

• Women are investing more than men for their goals, with clear and holistic goal-based plans

On average, women have 3.47 financial goals, while men have 3.74, showcasing a holistic approach. Women invest an average of Rs. 14,347 monthly, slightly higher than men at Rs. 13,704, challenging traditional assumptions. Notably, women show a 5% higher monthly savings rate for future goals. Additionally, women’s SIP investments have a 19% lower stoppage rate, affirming their resilience as long-term investors.”

• Women’s investment management needs are unique, differ from those of men

FinEdge also conducted detailed feedback sessions with their investment experts who manage investments for women clients, to glean qualitative insights on what women look for in their investing platforms. The following factors topped the list:

• Trustworthiness and reliability
• A non-sales centric approach
• A goal-based investing platform that is not complicated
• Handholding by an investment expert who is willing to explain the nuances of investing
• Empathy, Sensitivity and Customization

“An investment management business that specializes in women clients’ needs to take all the above into account. Traditional sales centric outfits (like bank RM’s) as well as cold DIY platforms (robo advisory) that lack the human element fail to meet their unique requirements. A bionic model that combines the best of tech and people is the key to success in this segment”, concluded Gahlaut.

Survey Methodology

The survey was conducted by FinEdge in the month of August this year. The sample is comprised of 3,763 women clients of FinEdge from the age bracket of 23 to 76 years. The study includes clients from across the region ranging from the West, East, North and South.

About FinEdge

FinEdge came into existence in the year 2011 with an aim to solve the core problem of the “investment gap” in India. It is a tech-enabled wealth management and goal planning platform. The platform is the first in the country to deploy goal-based investing as a BIONIC business model. FinEdge ensures that they reach demographics and geographies, provide a convenient, low-cost – high-quality, process-driven, goal-oriented, wealth creation platform to their clients. By Keeping their objective of ‘Investing with Purpose’ at the center of their strategies, they have created a vast network of clients across 76 countries and 1600 cities.