Female investors could double returns and reach savings goals faster

Written by Oliver Wade

Those who invested in a stocks and shares ISA 15 years ago could have enjoyed gains of almost double that experienced by individuals leaving money in cash over the same period, according to the latest figures from HM Revenue & Customs (HMRC).

However, the revenue’s statistics on the UK’s latest ISA sales revealed that almost half of women still prefer to save in cash, with 5,193 of them choosing a cash ISA over a stocks and shares ISA.

Despite this, analysis from Fidelity based on the full ISA allowance invested in the FTSE All Share compared to average cash savings rates over a 15 year period found that investors could have almost doubled their returns. Over the period, average cash savings were valued at £111,613.86 and the average value of a stocks and shares ISA being £215,831.80, revealing a difference of £104,217.94.

Fidelity’s Financial Power of Women report found that 43 per cent of women were likely to save using a cash ISA in the next two years compared to the 19 per cent who claimed they would invest via a stocks and shares ISA.

Commenting on the findings, Fidelity International investment director Maike Currie said: “Many women will have long-term goals and diligently stick to these whether saving for a child’s education or putting something away for a comfortable retirement. But while we tend to be diligent and committed savers, we often steer clear of the stock market altogether.

“Factors such as the gender pay gap, time off work to cover childcare and more women engaged in part-time work already contribute to a significant gap in women’s’ earnings versus their male counterparts. That’s why it’s important not to put yourself at a further disadvantage by not making your money work as hard as you are. With interest rates at record lows for almost a decade now and inflation rapidly rising, anyone holding an investment in cash will struggle to achieve a decent real return -that’s a return that keeps abreast of rising prices.”

However, Currie acknowledged that the stock market is a “riskier” option than cash, but noted that it is a “well-established” fact that over the long term, equities tend to outperform shares and has urged women to “take the plunge” and invest.

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