While investing is stereotypically perceived to be a testosterone-driven domain, studies have shown that women may in fact outperform men on returns when it came to individual investments1.
That said, fewer women invest than men, and women invest less compared to men in terms of the percentage of personal wealth2. With the average female lifespan outpacing that of the average male, it is more important for them to plan their investment for retirement and to begin the process as early as possible.
We caught up with Ms Rachel Ong, Deputy CMO; Senior Director and Head of UOB Asset Management’s Digital Channels and Sales who spearheads the development of UOBAM Invest, a corporate robo-adviser, on her thoughts on investing for women.
Why is investing so important for women?
For a lot of women, there is a tendency to focus on savings, particularly if they are supporting dependents such as parents and children. Instead of relying on bank cash or fixed deposits, there are better ways to grow their wealth through higher investment returns as cash depreciate in value because of inflation.
More importantly, there is a sense of empowerment when you are able to achieve wealth accumulation via active investing.
Why do you think women are behind the curve than men when it comes to investing?
Much of the inertia probably stems from the mindset that you need to be a good investor or that you require a lot of research and a deep understanding of markets. Many women who are also working mothers are often caught up with juggling multiple tasks be it work or family.
In my view, investing can also be a process of self-discovery such as understanding our own risk appetite and the stage of life whether one is single, married, or married with children. It’s a lifelong learning journey which is not dissimilar to say learning how to be a parent.
What steps can you take to start investing?
The misconception has always been that you need large amounts to do investments, you can start with as little as S$100 but more importantly on a consistent basis such as monthly. Over time, this not only adds up but evens out the costs when prices rise and fall.
The more you learn, the more confidence you will have to invest. Thanks to the wealth of resources on the internet, you can read up and make informed decisions when it comes to investing.
An early start allows a longer investment time horizon to plan, grow and take advantage of the compound effect.
What other advice can you offer?
Successful investments are executed over the long term, so there needs to be planning to make sure they coincide with the goals that you want to achieve. Even when markets experience down years, investors who stay the course will recover more quickly and stand a better chance of building real wealth in the longer term. One has to be mindful of not putting all the eggs into one basket, so diversification is key.
At what age or stage in in your life did you start to invest?
It is always tough multi-tasking and balancing my time between work and family commitments. However, I do allocate time to look at investing options. I do my own research online and invest via online platforms usually in unit trusts where I will compare the investment objectives and performance. It is importantly for me to understand and be comfortable with the investment objectives before I invest.
I have also started to better diversify my investment via robo-advisers as I was attracted by the low cost as well as the fact that my investments are looked after by professionals and that with a robo-adviser, I am able to transact anytime and anywhere. The convenience has motivated me to want to learn more about investing.
Since Mother’s Day is around the corner, can I ask how hands-on are you as a parent such as helping the children with their schoolwork or ferrying them for enrichment classes? How will the family be celebrating?
Besides the usual duties to be around and support my children when they need me, it’s always a challenge to set aside more time to go the extra length for my two boys, the younger one is only a few months old. I try to be as hands on as possible by helping to review and coach my 7-year old son, Darren, on his schoolwork no matter how late I come back from work. Weekends are reserved for family. If there are any enrichment classes, we spend the time catching up with each other during the rides.
Mother’s Day allows me to dedicate my time and focus on my family since I am home. It is also another excuse to show my mum my appreciation by giving her a nice treat or gift.
How are you balancing working from home (WFH) and family time during this circuit breaker period? Any tips for all the rest of working mums?
It was tough initially trying to balance everything at the same time especially when I get called upon by my children every few minutes! But as schedules are firmed and the momentum gets going, everyone has adapted to each other’s schedules, giving everybody the space to do what we need to do.
What has worked well was having open conversations with my son. By observing me, he has started to understand what work is all about and gives me the space and time I need to perform my tasks. He is able to better relate to what I do.
(1) Are women better investors than men? Warwick Business School, June 2018
(2) Best of Money: why do most women fear the stock market?. Financial Times, June 2016
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