German women struggle to build careers, on average earn less than men and are at higher risk of falling into poverty.In short, German women are still disadvantaged in many areas. .
But what’s interesting is that in areas where they could act independently, they often haven’t acted yet. For example, if you invest your own money.
One reason seems to be that many women think they know too little about finance. However, a study by the European Center for Economic Research (ZEW), based in Mannheim, Germany, found that this was more likely due to lack of confidence than actual knowledge gaps. Data show that women lag behind men in financial literacy, but one-third of the women surveyed by ZEW thought they were less financially literate than they actually were.
Wealth accumulation is dominated by men
Women around the world, not just in Germany, tend to voluntarily hand over control of their wealth to their male partners. 2) leaves long-term financial decisions to her husband.
As a result, a similar survey conducted by AXA Insurance Company found that women invest significantly less than men overall, with 27% of men owning stocks, equity funds, or other securities. compared to only 18% of women. And the German Aktien Institute, a financial industry group, found that only about 4 million of her 12 million Germans who invested in passive ETF funds in 2021 will be women.
This trend has intensified recently. Since 2011, the percentage of male shareholders has increased by 5 percentage points, while the percentage of female shareholders has increased by only 3 percentage points over the same period.
Alexandra Niessen-Ruenzi says it doesn’t help that about 80% of German financial advisors are men. “On average, women receive worse advice, as our research shows,” says Niesen Luenzi, who studies women and finance at the University of Mannheim in Germany.
Moreover, women’s economic behavior is related to socialization, Niesen-Ruenzi said. “We conducted a survey of students a few years ago and found that financial topics were often discussed between fathers and sons.” Being less sexual, it is not surprising that women are uncertain and perhaps have an inner reluctance to deal with the accumulation of wealth.
Promising target group
But Germany’s savings and loan bank said in a recent report that women represent a huge potential market and that the so-called women’s economy is “a bigger growth market than China and India combined.” This is because 31% of total wealth in Western Europe is held by women, they say.
“The financial industry is in the very early stages of unlocking this potential, both in terms of the number of female customers in general and the services offered to them,” the report added.
In recent years, things have started to change in the area of women investing. Banks are becoming more sensitive to this issue, and an army of female financial her advisors, so-called finfluencers, have emerged on the internet, allowing women to invest their own money and share financial knowledge “from woman to woman”. We promise to help you communicate
However, advice comes at a price. For example, Natascha Wegelin runs her website Madame Moneypenny, where she welcomes her visitors with a video claiming that “she knows exactly how she feels.” Additionally, she claims she lost 18,000 euros a few years ago due to “very bad financial advice” and now offers thousands of euros in “financial guidance.” According to her website, she is “not for everyone” and female clients should “sign up” for her services.
Finmarie’s website also offers paid and free financial information for women. Fincery is a fintech her startup that promises a little personal effort to get rich. Female customers simply download the app and answer a few questions about their investment preferences. And, “We will set up an ETF portfolio for you, monitor it, and adjust it as needed.” , Financery promises you don’t have to do anything else.
Beware of Bank Advisors
But consumer advocacy groups warn against trust-boosting online advisors and questionable get-rich-quick messages.
The Hamburg branch of the German Consumer Protection Agency warns that “coaching sessions are often expensive. Prices and services are opaque.” It spends a lot of money, the organization says on its website, adding that women should make the effort to learn the basics of finance on their own.
Annabelle Ermann of the Bremen Consumer Protection Agency cautions, especially “with respect to specific purchase recommendations” for financial products. “I’m always wary if someone promises quick and easy money,” she told DW. recommended. “Who is this person, how long have they been involved in finance, and what do they do for a living?”
Banks, on the other hand, are also jumping on the women’s investing bandwagon, asking their clients for advice specific to ‘women’s living conditions’.
For example, Comdirect, the online brokerage firm of Germany’s Commerzbank, offers women information and services on all aspects of money under the catchy title Finanz-Heldinnen (Financial Heroines in English).
However, women should be aware that banks primarily want to make money and tend to endorse their own financial products, Niessen-Ruenzi said. Do women really need special advice, she wondered. Her ING bank survey in the Netherlands shows that women are marginally better investors. ING found that in 2019, the woman achieved her average return on investment of 24%, while the man only earned about 23% that year.
This article was originally published in German.