High Net Worth Men and Women Maintain Similar Portfolios

10/28/2013

There are no substantial differences between the portfolios of HNW men and women, but what differences there are in asset distribution are telling, according to a new Spectrem report of investors based on gender. Men have a higher overall distribution of investable assets than women (62 percent vs. 55 percent).

A higher percentage of HNW women hold more assets in professionally managed accounts than men (28 percent vs. 24 percent), an indication of their greater tendency than men to rely on a financial advisor. Of those who identify themselves as self-directed investors, meaning they make all of their own financial and investment decisions, 28 percent of men said they do not use any financial advisors vs. 22 percent of women.

Two of the benefits women find in working with a financial advisor, according to a 2012 Spectrem study, are being able to delegate responsibility to an expert and the peace of mind they say working with a financial advisor gives them. The new report found that only 10 percent of HNW women investors consider themselves very knowledgeable about financial products and investments, compared with 28 percent of HNW men. Conversely, one-third of HNW women said they are not very knowledgeable vs. 11 percent of men (4 percent of women said they are not at all knowledgeable vs. 1 percent of men).

Similarly, HNW women are significantly less likely than men to say that they enjoy being actively involved in the day-to-day management of their investments (37 percent vs. 55 percent), an attitude that is heightened as wealth level increases. For example, four-in-ten of the wealthiest women surveyed said they liked to be hands on in the management of their investments compared with nearly seven-in-ten (67 percent) of HNW men.

In examining the portfolios of HNW men and women, women have slightly less assets in their rollover, contributory and Roth IRAs (21 percent vs. 23 percent of men, a reflection perhaps of salary inequality and economic challenges that inhibit saving toward retirement). Women, though, hold more assets in deposit accounts than men (14 percent and 11 percent). Their principal residence also comprises a higher percentage of their investable overall assets than men (16 percent vs. 13 percent).