By Amanda Morrall
When it comes to money, women have traditionally ruled the roost on the homefront, but shied away from more sophisticated finances.
However, KiwiSaver trends hint at a gender tide change.
Inland Revenue Department records show almost 60,000 more women than men are enrolled in KiwiSaver schemes as of December 2010. Total membership in the national savings programme which started in 2007 now exceeds 1.61 million with 831,127 females and 771,308 men.
Women’s Financial Strategies Director Sheryl Sutherland said it was little surprise that KiwiSaver was proving popular with the ladies. She believed the nature of the scheme on the whole was well suited to the female financial disposition, which she characterised as pragmatic and risk averse.
“If you look at the portfolios not many are incredibly high risk. Women tend to be really good budgeters, they know where everything goes and the KiwiSaver structure is clear. You can see into it and through it and obviously it is beneficial," Sutherland said.
Sutherland says the male appetite for risk-taking put them in a different camp; one that was more likely to put them in the investment fast-lane and vehicles outside of KiwiSaver.
“For men, there’s much more testosterone involved in their decision making. Doing something as banal as investing in a KiwiSaver for a guy, well you don’t go to your mates at the pub and say ‘Hey boys, I just got myself into KiwiSaver.’ They’re more likely to boast about buying shares in a gold mine in New South Wales. That’s the male way isn’t it?’’
Forsyth Barr investment adviser Ryan Cutts challenged the notion that women were more cautious and conservative.
“Among some of my clients, the women are the more savvy... I know some women that love to invest in mining stocks and high risk stocks because they love it," Cutts said.
Cutts cast doubt on a gender bias in KiwiSaver owing to the modest statistical divide of 51.8% women versus 48.1% men. However, he said the trend for women taking greater control of finances beyond the household sphere was pronounced.
“Women more and more are taking over the purse strings," he said.
'Appeals to the fairer sex'
Craigs Investment Partners Investment adviser Alexandra Dalzell was less dismissive about the IRD numbers showing 60,000 more women enrolled than men. She said it stood to reason that KiwiSaver would appeal to fairer sex. Craigs periodically runs women’s only investment seminars. See more here.
“I think that women quickly see the benefits of KiwiSaver. At least whenever I talk to women about KiwiSaver they quickly understand the responsibility of it -- the mindset if you like," she said.
As for risk appetite and the stereotype that women are more conservative investors, Dalzell said she thought it had more to do with comfort level and information than gender.
After more substantive discussions with clients about KiwiSaver, she said women - and men - were more likely to enroll in balanced or growth funds, as opposed to conservative funds, which tended to have a higher weighting of cash and bonds.
As KiwiSaver accounts grew in value, so would the level of interest investors took in their accounts, she predicted.
“I think for a lot of women it could well be their first investment. And that’s the start of the conversation’’
Dalzell said there weren’t many KiwiSavers with Craigs Investment Partners that were in purely fixed-interest funds (the sort represented in default and conservative funds) primarily because of the deeper level of discussions that preceded KiwiSaver enrolments through their firm.
She said KiwiSavers, as a whole, were not widely well informed about the ins and outs of the scheme, the different type of funds on the offer, and the ease of switching - both funds and providers.
Investment advisers and the industry were working to change that.
'Time to take a closer look'
“What we’re saying now is okay you’ve been in there for a couple of years, it’s time to take a closer look.’’
As of the end of 2010, about 38% of the eligible population had joined KiwiSaver. On a household level, half of those homes have at least one person (either adult or dependent) registered in a KiwiSaver scheme. See KiwiSaver annual report here.
More than $5.8 billion is invested in the system.