Comments on: Charts of the day, female risk-aversion edition A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: niveditas Sat, 01 Mar 2014 15:54:52 +0000 Felix, you’re not making much sense here:
“…the fact is that most of these people are probably not saving for retirement: they have more urgent expenses to deal with first..”: what does this have to do with gender differences, unless you think that women have disproportionately more urgent expenses? And if you do, you should at least write one sentence explaining why you think so.

Nor here:
“…people filling out investment questionnaires tend to overestimate their own risk appetites — which implies that men are taking too much risk, and that they’d be better off behaving more like women…”: again, on what basis are you asserting that men are more likely to overestimate their risk appetite than women?

By: Th.M Wed, 26 Feb 2014 16:53:36 +0000 Hmmm. A dimensionless number pulled from a survey explain by a regression whose r-squared is at best 14%.

By: TFF17 Tue, 25 Feb 2014 14:28:33 +0000 “women will end up with roughly 10% less money at retirement, thanks to their higher risk aversion”

That could easily mean that women are more likely to hit their retirement goals. Maximizing expected return should NOT be the metric of investing for retirement. Meeting income needs should be. (Which is why I’m puzzled by Felix’ insistence that investing choices should be focused on “matching or beating market indexes”.)

“You’d think that risk tolerance would rise with net worth, but in fact it doesn’t”

Arguably true, but remember that we are looking at a multi-factor picture. You’ll find far more $1M portfolios among those 50+ than among those in their 20s and 30s. Clear case of confounding.

I do find it interesting that the male/female difference converges to the right, as the individual ages and the wealth rises.

By: Twinkbait Tue, 25 Feb 2014 07:39:50 +0000 Confirms for me why women “marry ‘up.\'”

‘Nuff said, Hillary!

By: RyanTate Tue, 25 Feb 2014 00:48:01 +0000 Fun though it might be to speculate wildly about how “women invest like THIS, men invest like THIS,” the second chart above strongly suggests (does it not) that this is purely down to women earning less than men. Notice how the supposed female characteristic of conservative investment fades steadily away at the top income ranges?

Strong indicator that in the lowest ranges, where retirement savings competes with food, rent, and childrens’ education , women disproportionately make up the lower more vulnerable end of the spectrum. (I mean, we know that anyway, don’t we? Or shouldn’t we?)

By: cathamullen Mon, 24 Feb 2014 23:48:19 +0000 Felix, thanks for your interest in our study and your thoughtful review of the data!

I also wonder if the gender gap is greater for younger generations because financial acumen is likely lower. Studies (like this one: _paper.pdf) have shown that with “perceived competence” (i.e., get smarter), women take more risk, whereas men take less.

While we don’t measure competence for Personal Capital users, I don’t think it’s an implausible read of the data! And it suggests the need for better financial education. That’s why I’m so excited to be working at a company that empowers people to understand their finances :)