Women Are Investors: How To Shift Your Mindset

A 2024 survey from Investopedia and REAL SIMPLE found that 57% of women do not hold any investments. In some cases, some who said they have retirement accounts don't consider themselves investors. The two most common reasons women say they're not investing? They don't know how to start or they don't have enough money.

The data shows a need to reinforce two points: women are investors, and you don't need hundreds or even thousands of extra dollars to start investing. The most important thing is to start.

Shifting your mindset about investing can be the hardest part of starting your journey, but it can literally pay off. This article will help women in particular understand how their peers are thinking about investing, and how to confidently take on an investor mindset of their own.

How Women Feel About Investing Today

When it comes to investing, women have mixed feelings—and participation rates. The 2024 Her Money Mindset survey found just 43% of respondents said they are invested. Only 7% of women confidently said they know the most about investing compared to other financial topics, too.

On the flip side, the survey showcased the power and confidence that can be found in investing. Of the women who are invested, 61% said they are proud of an investing decision they made.

When asked what financial decision or action they are most proud of, here's what some of the women-identifying survey respondents anonymously said:

“Becoming more financially literate and learning about investing in something that can be used as a separate source of income. I have slowly but surely been investing in stocks and crypto when I have extra money.” -Millennial, single, annual household income of less than $75,000

"I am most proud of myself for investing part of my savings into the stock market and learning about the every day trends within the market." -Generation X, married or living with partner, annual household income over $75,000

"Deciding right out of college, to join my company's 401k. If I didn't do that, I would not be financially secure now." -Baby boomer, married or living with partner, annual household income over $75,000

These insights paired with data showing women are starting to invest at a higher rate than men are moves in the right directions, but a lack of communication, knowledge gaps, and fear are still holding women back.

Perhaps one of the most important ways to increase women's awareness and participation in investing is talking about it—but that's not happening much.

The Her Money Mindset survey found that women get most of their financial information from the internet, and family and friends. In fact, 70% of women said they talk to their friends about money, but only 34% of those talk about investing.

“As women, it is crucial for us to talk more about money and investing," said Valerie Leonard, CEO and financial advisor at EverThrive Financial Group. "We must have empowering conversations with one another that will help bridge the gender gap and encourage our friends and the next generation to get smarter with money.”

It can be hard to trust what you don't understand, too, and a lack of information is the No. 1 reason women said they are not investing.

Stephanie McCullough, founder and financial planner at Sofia Financial and the host of the Take Back Retirement podcast, sees this often in her investment practice, and she tells women this regularly: "You don’t have to have all the answers, and you just need to know what questions to ask and have the guts to ask them.” 

The Truth: Women Are Investors—And Good Ones

According to a Fidelity Women and Investing Study, women outperform their male counterparts in their investment portfolios by 40 basis points or 0.4 of a percentage point.

The 2024 Her Money Mindset Survey reinforced that women who are investing are engaged with their portfolio and market happenings. It's possible that this engagement helps drive portfolio performance.

The research women are doing may be boosting confidence in their investing, too.

One woman surveyed by Investopedia and Real Simple said she focuses on “choosing to invest in stocks that pay dividends rather than focusing solely on performance and trends.” Another said her best investment strategy is “purchasing high-quality company stocks and holding them for the long term.”

Advice From Women, For Women

Start Now

Stephanie Tisdale, avid investor and owner of Breakthrough Bookkeeping, said learning to invest “was like drinking from a firehose." There was so much information that she had a hard time distilling what was most important to her and her circumstances, which led to inaction for longer than she would have liked.

Once she started at age 35, she quickly realized the impact investing makes on reducing the distance between where Stephanie began and where she wants to be.

Leonard said women’s desire to invest is usually tied to goals. Women are not jumping into investing simply for the love of the game. She finds that women are motivated to invest by wanting to put kids through college, buy a new home, save for retirement, etc. 

When it comes to investing, time is your best friend. The sooner you start, the more time you have to benefit from compound interest. If it helps to focus your efforts, identify a goal you are passionate about, and invest with that goal and timeline in mind.

Money Is Not Shameful

McCullough specializes in working with women investors and supporting them in meeting their financial goals. She finds that a lot of women will self-describe as “a mess” because of societal stereotypes about overspending, being "bad" with money, etc.

Many of McCullough's clients have never been taught about money before, and they take on the stereotypes as truth about themselves even when it’s not true—and most of the time, it's not.

Even if it is true that you’re not "good" with money now, McCullough wants you to know that it's not a character flaw and that the shame spiral won’t get you any closer to meeting your goals. 

Consider What You Have To Gain

McCullough frequently sees women enter the market “when the pain of staying where you are is greater than the pain of change.” Still, once women take the plunge into investing, many tell her that they can’t believe they waited as long as they did.  

Start Small

According to the 2024 Her Money Mindset Survey, one of the biggest reasons women say they are not investing is that they don’t think they have enough money left over at the end of the month. It is a huge misconception that to invest, you have to have a lot of money.

A great place to start is participating in an employer-sponsored plan (like a 401(k)), especially if your employer is offering a contribution match. You can also put a few dollars a month into a target-date ETF and let dollar-cost averaging and compounding interest work for you.  

McCullough said she wants to remind all women: “You can start long before you feel you know everything.”

Make A Plan

The very first thing you need to do to get started investing is figure out why you want to save. The journey of investing should always start with goals and a timeframe. For example, are you planning to buy a house in five years? How much money will you need to make a necessary down payment? 

Once you’ve answered these questions, you can build a roadmap with investment products to get you there. Here are some starting points to direct your research: 

• If you're prioritizing retirement savings, look into individual retirement accounts (both Roth and traditional), and find out if your employer offers a 401(k) plan and matches contributions. 
• If you're hoping to save for education expenses, look into 529 Plans and Coverdell accounts. 
• If you're saving for long-term goals (like building a dream home in 10+ years), look into mutual or index funds.  

And, of course, you can always contact a financial advisor in your area. Even if you have $50 a month to invest, you can find a financial advisor to guide you on your wealth-building journey.  

Frequently Asked Questions (FAQs)

The Bottom Line

Even though investing can be intimidating for many women, they can be capable and conscientious investors once they take the first step and get started.

The key to overcoming the hesitations that keep women out of the investment markets is education: whether that be with self-directed research, conversations with a seasoned investment professional, or even conversations with friends.   

Above all, remember, women are investors.