The Final Wave of Feminism
As we round the corner on the last few months of 2016, it’s not hard for us to note at Ellevate Network how much progress we’ve made as women. Whether it’s “leaning in” at work, women taking home the hardware at the Olympics, or having a women leading the polls in the race for President…we’ve come a long way, baby.
But we’re not there yet, are we? We’re not yet equal with men.
Women have been fighting for so long to be equal with men in so many ways (from voting to the wage gap), and we’ve come so far. But we haven’t reached full equality. And this gap in power is most clear in that symbol of power itself: money.
We all know money is power. And so we all know, intuitively, that money and feminism are intertwined. And that full gender equality is not achieved until full financial equality is achieved and we are on par with our male counterparts.
Absolutely, we’re making progress in a number of areas on this front. Sheryl Sandberg brought a renewed energy to the issue of women advancing in the workplace – and thus earning more – through her work on Lean In; this has been followed by a virtual tsunami of advice for women on how to get that raise or start a business or build a non-traditional career through freelancing. The energy around this is palpable, and Ellevate Network is a real part of that.
And on the public policy front, we’re having discussions on paid parental leave, as a presidential campaign issue for the first time in recent memory. There is even an emerging view, driven by research such as that by KPMG, that parental leaves like this are not only good for families, but also save costs for the companies themselves, as they reduce their turnover.
But there is one area regarding money that remains more 1958 than 2016. It is not part of this conversation. And that is investing.
I saw a lot of you on my travels this past summer, and the question of “Why did you launch Ellevest?“ came up a lot. (Honestly, there was a sense of “Don’t you have enough to do?”) Well, here’s why:
If women are not investing their money in the capital markets to the extent that men are (and we’re not), then we’re falling even further behind men financially. And while most of us intuitively believe that the “gender pay gap” is more expensive for women than the “gender investing gap,” that is not necessarily the case. Keeping our money in the bank, instead of investing it, can cost us women hundreds of thousands of dollars – or even millions of dollars – over the course of our working lives. And since women tend to live longer than men – by five years-plus – the impact of any shortfall in our money is even greater for us than for men.
In investing and money, the old gender norms are alive and well and, somewhat surprisingly, aren’t being challenged. This is in part driven by the investing industry itself: financial advisors are still 85%+ male, the language of the investing industry is the language of sports or war (“beating the market” and “picking the winners”), and investing shows on tv can easily be mistaken for ESPN. Heck, even the brand symbol of the industry itself is a bull.
Get it? Doesn’t get more male than that.
In our research, some women tell us they have a great relationship with their financial advisor. But many more women tell us that the industry’s financial advisors can represent an obstacle to their investing. Not because they mean to, but observations of (mostly male) financial advisors engaging with clients show that they tend to talk more – much more – to the male half of any client couple. And when advisors are asked to estimate the time they spend talking with each partner, they vastly overestimate how much time they spend talking to the female.
Our research also tells us that even the product offerings of the investing firms appeal more to men, with their focus on investment upside to a much greater degree than on capital preservation. Furthermore, women report that they value achieving financial peace of mind seven times as much as they value accumulating wealth.
This masculine orientation to investing is buttressed by a media that continues to peddle the soft biases around women and money: that men are better at math, that women need “more handholding” to invest, that women need more financial education in order to invest, that women are “too risk averse” to be good investors. (Note: None of these are true, and they all smack of “blame the victim.”) And time and again, the media underplays the negative impact of not investing, with many stories on the topic noting that, well, the real issue is the gender pay gap, anyway.
So, this is an area – one of the few remaining – in which it is still accepted that men are “just better” than women are. (For the record, lest you think that to be the case, when investing is made easy-to-access for women, such as 401(k)s offered in the workplace, women invest at a higher rate than men. And women also tend to be as good or better investors than men; this is true whether for professional investors, such as hedge fund and mutual fund managers, or as individual investors.)
The result: As women are rejecting shame around so many other formerly taboo topics (just look at the subway ads in New York City for Thinx period underwear), money is fast becoming the last bastion of traditional gender roles. In talking to hundreds of women on the topic, money can still represent for them some fundamental inadequacy, the solution to which remains out of reach; it requires either deciphering some foreign language (of investing jargon) or engaging with an industry whose representatives do not reflect them.
And just in case one thinks there can be any argument against women being more actively involved in investing, it’s worth noting that – as with so many of the changes that the work of feminism has driven – women investing more would be a positive for the economy. That’s because women control $5 trillion in investable assets in this country; if just 5% of that found its way to the stock markets, that would represent $250 billion pouring into the capital markets. That’s capital that is then available to fund companies and their growth. And women investing more would go some ways to closing this country’s retirement savings gap, given that women live longer than men yet retire with two-thirds the money.
The solution to the gender investing gap? It likely involves women – and their spouses and partners – simply refusing to accept the status quo any longer. It likely involves our recognition of the negative impact this can have and refusing to take a back seat in this part of our lives. It likely involves our rejection of the societal messages around money being the province of men and our demand that the investing industry engage with us without patronizing us.
Thus Ellevest, a digital investment platform for women. It was built through spending hundreds of hours with women like you, many also part of Ellevate Network, rethinking what an investment platform for women should look like. We started with the understanding that we women live longer than men do (pretty important to take into account in a financial and investing plan), that our salaries tend to peak sooner than men’s do (irritating as all-get-out, but likewise important to take into account) and that women are more risk-aware than men. From there, you led us to recognize that women tend to want to invest as a means to reach their life goals rather than to outperform the markets. And that you are looking for a fiduciary who puts your interests ahead of its.
What it isn’t: dumbed down, or all about remedial financial education, or all about women’s emotions around money. Those approaches also represent a throwback to the 1950s. Why can’t “investing for women” mean different, yes…but smarter, too?
We women, and particularly all of you at Ellevate Network, are so close to completing the work of Gloria Steinem. Feminism had to start with basic human and civil rights first; but in a capitalist society, until women achieve financial equality, we simply are not equal. Thus, the work of feminism is not done. It’s now time to turn the work of feminism to finance.
Ellevest remains invite-only, but members of the Ellevate Network are invited to join by using the following link: https://secure.ellevest.com/invite/ellevatenetwork
Have more questions? Follow up with the expert herself.
Sallie Krawcheck’s mission is to help women reach their financial and professional goals (or, put more bluntly, to get more money into the hands of women), thus enabling them to live better lives and unleashing a positive ripple effect for our families, our communities and our economy. She is the CEO and co-founder of Ellevest, an innovative financial company, by women for women. Ellevest is one of the fastest growing digital investment platforms and has... Continue Reading
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