How women should invest differently than men

Jessica Spangler, author of the newly released “Invest Like a Girl,” realizes that her book’s title might raise questions.

There is some skepticism because many goods marketed as “for women” — think razors and ballpoint pens — are not substantially different than those marketed to men. And indeed, she said, investing fundamentals don’t change based on gender identity.

But, she said, there are significant gender differences when it comes to investing that are important to explore: Women tend to live longer, for example, which means they need more money to support themselves post-retirement. They are also more likely to earn less because of the wage gap in this country and to experience career breaks because of caregiving responsibilities, Spangler said.

A 2023 study by the U.S. Department of Labor put a dollar amount on the average pay loss experienced by women over their lifetime due to caregiving for children and parents: $295,000.

“We’re often behind when it comes to saving for retirement,” Spangler said. “We have to think about investing early, investing often and investing aggressively, as much as we can.”

Financial experts suggest these steps for getting started:

CONFRONT ANY FEARS

Tori Dunlap, founder of Her First $100K, offers money and career resources to millennial and Gen Z women. She said the No. 1 factor that holds women back from investing is fear, including fear of doing things “wrong” or losing money.

“All of these fears are natural and common, but they aren’t stopping men from investing,” she wrote in an email.

LEARN AS MUCH AS POSSIBLE

Seeking guidance online can be helpful, said Stephanie Hughes, CEO of Wiss Private Client Advisors, an accounting firm and financial advisory based in New Jersey. She suggested starting with reputable sources such as financial institutions and licensed professionals.

Hughes cautioned that some social media influencers may lack financial backgrounds or have ulterior motives when selling specific products.

BEGIN WHEREVER YOU ARE

You can begin with relatively small amounts of money, said Marguerita Cheng, a certified financial planner. “People think you need to have a lot of money to invest, but the opposite is true. When you invest, you build wealth.” But, she said, since investments can gain or lose value over time, you want to choose an amount that is comfortable for your budget.

If you’re working with a financial professional, Cheng said, it’s important that you don’t feel pressured to make decisions before you’re ready.

MAKE IT AUTOMATIC

Cheng said automating deductions from your paycheck into an investment account can be an easy way to stay on track.

PLAN FOR LONGEVITY

Since women live longer than men on average, Hughes said it’s important to save and invest accordingly. “You need to have more money to fund those extra years,” she said.