On average, women invest less than men do, but recent statistics show that they’re generally better at it than their male counterparts.

Women tend to invest slightly differently from men. Although they may make fewer high-risk investments that lead to large short-term returns, women generally have stronger portfolios regardless of market conditions. In this article, we will be taking a deeper look into how women invest and why it matters. 

The Way Women Invest

Below are three key differences in the way women invest, as well as a brief explanation of what this means for the future of women investors.

  1. Women are more likely to hold cash and focus on savings

About 67% of women are now investing outside of retirement accounts, which is a large jump compared to previous years. Still, many women tend to hold and save more cash as opposed to investing it. Many factors may contribute to this, including a lack of confidence in choosing investments and lower annual earnings, which may influence the way women allocate money.

Women’s portfolios have been shown to outperform men’s in a recent study by Fidelity. If more women shift their focus from saving to investing, they have a chance to earn thousands upon thousands more in returns compared to the minimal interest they receive from savings or retirement accounts.

  1. A lack of confidence leads to less investing

Investing is one of the best ways to generate wealth and make headway on the path to financial equality and financial freedom. The grand majority of women will be completely financially independent at some point in their lives, and for many, it might seem like the safest option is to save money. Unfortunately, this isn’t the best way to increase wealth in the long run.


In order to turn the tides, education about investing needs to be prioritized, as knowledge about the subject will increase confidence and thus increase investments.

  1. Choosing low-risk options

Women are less likely to go for high-risk investments. This is not necessarily a bad thing. While high-risk investments can lead to high returns, they are also much more likely to backfire. Women are more likely to invest their savings in long-term and age-based assets such as target-date funds.

An aversion to risk is healthy to a certain extent, but investing in stocks and more volatile assets is also essential to get the most out of one’s portfolio. Less than half of women in the U.S. (48%) invest in the stock market. Several things can be done to increase this percentage with a bottom-up approach:

  • Speak to a financial advisor or wealth management professional.
  • Share investing knowledge with your female family members and friends.
  • Begin self-teaching and experimenting with stock investing and trading.


Statistically, women invest less, especially in the stock market. They are less likely to make high-risk investments and they have a larger percentage of their portfolio tied up in cash and similar assets. Even so, women’s portfolios have been found to outperform men’s.

Taking on more risk and refocusing priorities on investing as opposed to saving can give women a more authoritative and dynamic position in the market. Encouraging education surrounding investing and the benefits of diversifying one’s portfolio can help boost confidence and increase investments.