The Feminization Of Wealth: Rewriting The Narrative For Women Investors

The landscape of wealth is undergoing a profound transformation, with women increasingly becoming the primary custodians of financial assets. This shift, often referred to as the or "feminization of wealth" as coined by Ellevest, is not just a passing trend—it’s a seismic shift in the financial world.

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As women continue to outlive men, inherit wealth, and make critical financial decisions, it's crucial to understand how they approach investing, the challenges they face, and the misconceptions that still stubbornly persist.

According to a report by the Boston Consulting Group (BCG), women now control 32% of the world’s wealth, totaling a staggering $72 trillion. This figure is expected to grow at a rate of 7% annually, outpacing the overall growth of global wealth. And with women living, on average, five to six years longer than men, they are often left as the primary financial decision-makers, inheriting wealth from their spouses.

But here’s the kicker: the transition from dual-income households to single-income or widowhood often reveals shocking gaps in financial planning. A study by UBS found that 74% of widows and divorcees discovered negative financial surprises after taking control of their finances. This statistic is a loud wake-up call for better financial education and preparation for women, many of whom were not the primary financial planners during their marriages.

A recent study from Wells Fargo and The Female Quotient found that 74% of women said that financial health is important to living their lives, yet only 51% feel confident in financial management. The gap between concern and action is where the financial industry needs to step up.

One of the most persistent—and frankly infuriating—myths about women and investing is that women are less capable investors than men. This stereotype is not only outdated but downright wrong. The reality? Women often approach investing with a different mindset than men—one that is more risk-aware and focused on long-term stability. Sallie Krawcheck, co-founder and CEO of Ellevest, a digital financial advisor for women with over $2 billion in investments, has been at the forefront of changing this narrative.

"Women are not risk-averse; we are risk-aware," Krawcheck often says. This distinction is critical. While men may be more likely to take on high-risk investments for the potential of greater returns, women tend to prioritize financial security, diversification, and sustainable growth. Studies have shown that women, when they do invest, tend to outperform men because they trade less frequently, avoid speculative bubbles, and keep their eyes on the long game.

Yet, the financial industry has historically failed to cater to women’s unique needs and preferences. Many women report feeling underestimated or outright ignored by financial advisors. In fact, The FQ and Wells Fargo’s study found that women are less likely than men to talk to a financial professional about their financial health. It’s no wonder that many widows or divorced women often fire their financial advisors after their spouse's death or a divorce. Unsure of where to begin with their newfound wealth, many women end up placing it in low-yield bank accounts out of caution, missing out on potential growth opportunities.

It’s time to change the conversation. The narrative that women don’t know what to do with their wealth isn’t just wrong—it’s damaging. It perpetuates a cycle where women feel less confident in their financial decisions and are more likely to disengage from financial planning altogether. The truth is, when given the right tools and information, women are just as capable, if not more so, of managing and growing their wealth effectively.

A 2022 study by Fidelity Investments found that women who invest in the stock market achieve returns comparable to, or even slightly better than, their male counterparts. Yet, only 29% of women see themselves as investors, compared to 51% of men. This perception gap is the real challenge that needs addressing.

Financial education and literacy are critical components of enabling women to take control of their financial futures. Programs like Ellevest and others focused on women’s financial planning are essential in closing this gap. These platforms not only provide women with the tools to invest confidently but also offer guidance tailored to their unique financial goals and circumstances.

It’s a new era of financial power for women, and this feminization of wealth isn’t just a demographic shift—it’s an opportunity to redefine how wealth is managed and invested. As more women become the stewards of financial assets, it’s time to dispel the myths and misconceptions that have long hindered their power.

Women are playing an increasingly important role in the future of wealth. With the right approach, they can not only maintain but also grow and pass on their wealth to the next generation. It’s time to flip the script—from one of uncertainty and caution to one of confidence, capability, and success.

By Shelley Zalis, Senior Contributor