☞ How Millennial Women Invest
Millennial women have been actively saving and investing, although their preferences might surprise you.
According to a recent survey conducted by Credello, a fintech company, nearly half of millennial women lean towards investing in real estate rather than stocks.
Meredith Lepore, editor of Credello, shared fascinating insights: “Over 40% prefer real estate, citing better returns, while 37% find it safer compared to stocks.
Additionally, 30% opt for investing in a home over the markets due to fears of potential financial losses.”
The survey involved 600 women in the U.S. between the ages of 27 and 42, approximating the current age range of the millennial generation.
What’s intriguing is that these women are backing their intentions with actions—70% of those surveyed have independently purchased a home.
When asked about investing an extra $5,000 monthly, the survey revealed diverse inclinations. While some (just under 25%) would opt for stocks and bonds, an equal percentage preferred channeling funds into savings or retirement accounts.
Reflecting on these findings, it’s not entirely surprising as a millennial myself. During the years, I’ve observed a hesitancy among female peers towards stock market investments.
This contrasted sharply with the enthusiasm displayed by male friends, a divergence I attribute to societal influences and discussions prevalent in platforms like Reddit.
Now, let’s address the concern: Real estate investment is undoubtedly prudent, especially in one’s residence. Purchasing a home is a vital step towards building wealth and ensuring financial security.
However, diversification is key for everyone. The early earning years, particularly, present an opportune moment to explore riskier yet potentially rewarding options, such as the stock market.
Despite its volatility, historical trends show that, in the long run, the stock market tends to yield higher returns compared to real estate.
Consider the period from 2013 to 2022, crucial for typical millennial earners. During this decade, the S&P 500 recorded an average annual total return of 13.7%, as per S&P Global Market Intelligence.
Unfortunately, many millennial women missed out on this potential growth, contributing to the gender wealth gap, a point emphasized by Ellevest.
Acknowledging the caution stemming from the 2008 crash is valid. However, it’s essential to highlight that diversification mitigates risks, and one need not possess substantial wealth to enter the stock market.
While savings have garnered attention recently, the stock market remains an enduring avenue for long-term investment. With the internet simplifying investment processes, starting with index funds or ETFs can be a feasible entry point.
It’s pertinent to empower millennial women with financial knowledge, encouraging them to explore diverse investment avenues without overlooking the potential offered by the stock market.
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