4 confidence-boosting tips for women investors

Written by Lori Campbell on 5th Jul 2023

If you’re a woman who doesn’t invest because the idea paralyses you with fear, you’re far from alone. New research reveals that fear is a major barrier to investing for a third (32 per cent) of women – compared to 23 per cent of men.

The research by Fidelity International, as part of its Women and Money campaign, highlights that a fear of risk continues to weigh heavily on women’s financial futures.

With women’s more cautious approach to investing, they could miss out on potentially valuable gains from long-term investment growth. Seven in ten (69 per cent) of the women surveyed – who all have at least £1,000 in assets – say they continue to take a tentative or cautious approach to investing, compared to 59 per cent of men.

Encouragingly, women’s confidence in investing does seem to be growing. The same survey in 2018 found a higher number of women (37 per cent) were set back from investing by fear. The good news is that with a few strategies, you can gradually overcome your fears and start taking control of your finances through smart investment choices.

Here, Fidelity International’s Associate Director for Personal Investing Emma-Lou Montgomery, gives her top four confidence-boosting tips for women investors.

1. Establish clear goals and an investing plan

Starting your journey into investing can be a daunting task, with many options to choose from and different approaches to take. Our data shows that 61 per cent of women are not currently investing, with just nine per cent planning to start in the next 12 months.

By breaking down your reasons for investing, asking yourself some important questions and creating a clear plan, things can seem much more manageable. Some questions you might want to consider are:

  • How much money do I have to invest?
  • What am I investing for?
  • How long am I willing to invest for to reach my goal?

If you’re already investing but want to build further structure around your goals, it’s always worth taking time to reflect, review and rebalance – particularly during times of uncertainty. Getting into the habit of reviewing and rebalancing your portfolio on a yearly basis is a healthy investment practice and could have a positive impact on your returns.

Why women NEED to invest

2. Understanding your risk appetite

Our research finds that a third (32 per cent) of women say their fear of risk is one of the most significant barriers to them either starting to invest or contributing further sums to their portfolio. While the risk can feel intimidating, and there’s always the chance that your investments will go up or down in value, it’s important to remember that your attitude to risk is a factor within your control.

Depending on your financial situation, and your age and reason for investing, you might feel prepared to put up with higher risk for the potential of greater returns. Or if you’re wanting safer, and steadier returns then a lower risk attitude might be more suitable for your needs.

Your investment goals and attitude to risk are very personal, and will likely change over time, so it’s important to regularly ask yourself if your current portfolio still aligns to your appetite for risk – and remember that it’s entirely normal for your investments to fluctuate as the market changes.

Gender ISA gap: a THIRD more men invest than women

3. Spread your bets

The investments you choose to hold in your portfolio will be closely aligned with your goals, risk appetite, as well as how long you plan to invest. However, it’s important to properly diversify your portfolio to ensure you are spreading your risk.

A well-diversified portfolio will generally have a mix of assets – from shares and bonds to alternatives such as commodities and property – to build in added protection from market volatility. It’s also worth considering investments across different sectors and geographies to add further diversity to your portfolio. Most importantly it’s key to not put all your eggs in one basket, and remember that while some investments may go down, other well-placed choices could see the performance of your portfolio improve overall.

The Good Guide to Financial Wellbeing for Women

4. Keep your finger on the pulse

Whether you are an experienced or early-stage investor, regularly taking time to understand how the markets affect your investments is an important habit to get into. This doesn’t mean becoming an expert overnight, but you should consider consuming news and content that will better inform you about your portfolio. At the same time, it’s vital to try and not get distracted by the daily performance of individual investments as even experts can find it impossible to time the markets. Tinkering with your investments could help you take advantage of opportunities, but they could equally leave you susceptible to potential risk if you aren’t correctly informed.

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