Enlarge symbolArrows point outwards
Female investors are stepping up their game, gaining confidence and taking more risks. However, they still lag behind their male counterparts when it comes to how much money they put into the market.
However, women are expected to experience an influx of wealth in what has been called the “Great Wealth Transfer.”
Cerulli Associates estimates that $105 trillion in wealth will be passed down to heirs by 2048, with approximately $54 trillion of that inheritance going to spouses. According to the Centers for Disease Control and Prevention, women on average live nearly six years longer than men. This increases the likelihood that they will be the primary recipients of this wealth.
“We are facing a massive shift in terms of who will control the assets,” said Stephanie Link, chief investment strategist and portfolio manager at asset management firm Hightower Advisors.
Watch Stephanie Link live here: CNBC Pro Live – Wealth for Women – You are invited to attend an exclusive, live, in-person event on NASDAQ MarketSite on May 28, designed specifically for serious investors who demand more than just superficial market commentary. More details below.
According to McKinsey & Company, women held $18 trillion in investable assets in the United States in 2023, representing 34% of assets under management. That number is expected to nearly double to $34 trillion by 2030, representing about 38% of total U.S. wealth, the consulting firm noted.
We’ve seen improvement in those that are becoming more sophisticated, but we still have a long, long way to go.
Stephanie Link
Hightower Advisors
While wealth transfer is one way to narrow the gender gap in investing, women still earn less than men in the workplace. According to the National Women’s Law Center, full-time working women in the United States are typically paid 81 cents for every dollar paid to men.
That has created a gap in retirement savings, said Veronica Willis, global investment strategist at Wells Fargo Investment Institute. Willis is co-author of the firm’s 2025 Women and Investing report.
“We have seen some signs that the gap is starting to close, but there is still work to be done,” she said.
How women invest
According to a Wells Fargo study, women are more likely to describe their investment approach as conservative.
Link said she sees this with her female clients who don’t focus on spanking S&P 500 and instead want to preserve the wealth they have.
“We have seen improvement in those who are becoming more sophisticated, but we still have a long, long way to go,” Link added.
In fact, women today tend to be a little less conservative and actually take a little more risk, Willis said. They also gained confidence in their ability to invest, she noted.
According to a Wells Fargo survey, around 71% of women said they would have invested in the stock market in 2024, up from 60% the year before. Gen Z and Millennials led the way.
In fact, the company’s analysis found that the performance of single, female, and female-led accounts was similar to that of single, male, and male-led accounts over a seven-year period. However, accounts run by women generated the highest risk-adjusted returns, Willis said.
“Women tend to check these accounts less each day, which means they are less likely to do as many trades,” she explained. “That willingness to stick with an investment plan … benefits these women.”
Maximize returns
Prasit photo | moment | Getty Images
Investors should evaluate their goals to understand how they should invest, Willis said. Then they should make sure they have the right allocations in their portfolio so that their investments grow over time, she noted.
“[Make] Make sure you have a good mix of stocks and some assets that diversify the equity risk a little bit,” she said.[Resist] who have the urge to seek safety, invest in cash or any fixed income asset when it comes to retirement.”
Shannon Saccocia, chief investment officer at NB Private Wealth, likes to break it down by age group.
Women should start investing early, with women in their 20s and 30s focusing on discipline to develop strong financial habits, she said.
By the time they reached their late 30s and 40s, they should have started accumulating some wealth, she noted.
“But they should also consider broader financial advice — not just how to allocate their 401(k) and optimize their savings, but also understand that the working capital generated by work is a meaningful input into their financial equation,” Saccocia said.
These include issues around workplace compensation and the best ways to diversify stock ownership, she noted.
Later in life, women should be honest about what they want during and after their lives.
“Who will carry on their legacy? How do they think about balancing lifestyle, philanthropy and intergenerational wealth transfer? This should be clearly expressed in conversations with their advisors,” Saccocia said.
For Hightower’s Link, education is key. Start reading, find an advisor who can help you achieve your goals and talk to other women, whether at a game of mahjong or in an investment group, she said.
For those looking to start investing, the best advice she got was from her father shortly after she graduated from college in 1992.
“You start investing very early, and when you’re younger you can take more risk… you want to have more equity exposure rather than fixed income,” she said. “You want to start with cost averaging.”
Dollar-cost averaging allows investors to build positions over time and at different prices. Investors can withdraw a specific amount — even $10, $50 or $100 — directly from their bank account and invest it in an exchange-traded fund that tracks the S&P, she said.
People with 401(k)s can have funds deducted directly from their paycheck.
“You will never miss it, and over time you will be very grateful and very grateful that you did this because you will not be able to time the market,” Link said.
An exclusive invitation: CNBC Pro Live – Wealth for Women: You are invited to attend an exclusive, live, in-person event on NASDAQ MarketSite on May 28, designed specifically for serious investors who demand more than just superficial market commentary. CNBC contributors will present a series of “Strategy Salons” designed to provide personalized, empathetic and actionable financial growth strategies. Attendees will have the opportunity to ask their questions and receive answers about how to navigate the changing investment landscape.
Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.