When it comes to women investing, I’m reminded of a quote attributed to Einstein: “If you ask a fish to climb a tree, she’ll always feel stupid.”
Same is true with money. If you try to approach finances like a man, you’ll always feel like a fish out of water.
So instead of trying to do it ‘their way,’ it’s time we value the feminine perspective. Let’s look at 5 ways the genders differ:
#1: Our Impetus for Investing
Men are very motivated by profit, perks, personal gain. No matter how much they have, amassing more is a powerful incentive.
Not women. Once we’re financially stable, we’re rarely motivated by money. Sure, we want to profit. But what really inspires us is helping others.
#2: Our Reasons for Giving
Men like to help others too. But for different reasons. According to the University of Indiana’s School of Philanthropy, men give to have a building named after them, pressure from office or peers, or a seat on the board.
Women give to make a difference, pass on family tradition, and give back to community.
What’s also interesting: women generally donate more than men, but they give in much smaller amounts to twice as many organizations, diluting the impact they make.
#3: Our Communication Style
Men communicate to obtain information, establish status, and show independence. It’s all about the transaction. They prefer to focus on the facts, talk about performance, wanting to be right, looked up to and feel in control.
Women communicate to create relationships and make connections so we can build rapport, develop trust, feel understood, accepted and acknowledged.
#4: Our Risk Tolerance
Men are wired to be risk takers. They enter the market, like their prehistoric ancestors hunted for wild game—boldly, bravely, with the expectation of gain
Women see investing as a threat, so we avoid the markets like our ancestors fled from wooly mammoths. Thus, investing can be a very scary, emotional process. Sadly, in the financial world, conversations about emotions are considered too touch-feely.
However, once we women are in the market, we tend to trade less and invest long term, a much smarter strategy (but not a common male strategy) making us more successful than men over time.
#5: Our Learning Styles
Men like to learn through trial and error. Women prefer to be taught about finances, mostly in groups.
According to an Emory University study, “the pleasure and reward centers of their brain light up if [women] can work towards their financial goals in a cooperative way with other women.”
This is why I created The Wealth Connection, a virtual community of like-minded women, where we openly and authentically talk about our financial dreams and the stumbling blocks that get in our way. CLICK HERE to find out more.
Have traditional financial resources left you feeling like a “fish out of water”? Share your thoughts in the comments below.