Broker Check

Finance May See Challenges for Women - We Choose to See Opportunities

September 30, 2021

A brochure recently landed on my desk entitled, “Women’s Financial Challenges Just Got Greater Because of the COVID-19 Pandemic.” Inside, the brochure proclaims that “Women Face Eight Unique Retirement Planning Challenges.” The list is familiar – from the gender pay gap to work/life balance choices that we make and the longevity that we still have on our side. The list was also long — eight challenges? All of them unique to women? Really?


But one of the too-many challenges stood out: “Women’s low tolerance for risk means that their money often grows more slowly.”


This is a common misconception in financial planning circles. Yes, studies have identified women as more “risk-averse” than men. As such, women’s investment success may not be as high. Thankfully, this cause/effect assumption has been challenged recently, in studies that dig deeper into gender’s affect on the risk/reward relationship.


Last year, the Harvard Business Review released a study analyzing how women and men take risks when the goal goes beyond financial outcomes — by examining how teams make impact investing scenarios with financial and social implications. HBR’s research found that impact investment firms with a higher proportion of women in the top management team took significantly more risks in their investment decisions than those with more men.


This is our experience in financial planning – our female clients are happy to take risks when they understand how risk works and where it can benefit a family in achieving a lifetime goal.


The misconception about women and risk is also conflated with the idea that women are not interested in learning about investing. While studies support the idea that fewer women are confident about investing than men (by about 10%), boots-on-the-ground experience with our Aspen Society tells us that investing is a primary focus for women. The women-only group recently ranked their top priorities for financial education. Investments and taxes were the top choices.


This is why I bristled when reading the brochure with its all-too-common misconceptions. And why our team at BFS Advisory Group takes a more nuanced approach. We have enough experience and academic training to embrace the notion that higher-risk investors tend to be rewarded with higher returns over the long term. But risk tolerance is just one aspect. We also examine risk capacity, which is very different for every client. In fact, in a recent Fast Company article, author Anne-Marie Slaughter suggests, “risk-taking is not a stable personality trait even among individuals, much less across genders.”


We are also very clear about our goals for financial education:  we focus on the facts of the present and the risks and opportunities in the future ahead. We believe the market is gender-neutral and that everyone’s financial plan should be different.


It is in that spirit that I share some findings from our recent Aspen Society event. Yes, we only invite women, but the investment strategies affect us all.   


Our team presented alongside Luke Trammel, Senior Vice President at America Funds on the current state of the markets – and what we can expect in 2030. Key findings include:

  • Financial markets always have Risks and Opportunities. Throughout the global and domestic stock and bond markets, we have some obvious risks including inflation, supply chain woes, and potential interest rate increases. We also have very distinct opportunities such as strong consumer demand, and an ongoing economic recovery fueled by global central bank policy and government support.


  • Innovation is all around us, providing new opportunities as we look ahead over the next ten years. From healthcare and energy to the very way we use money, new markets are developing now and have significant potential for investment going forward.


  • Your portfolio should serve your financial plan, not the other way around. Your investments should serve your goals, both long- and short-term, and that may mean having different levels of risk in your assets.


If you are a woman or have a woman in your life that values frank discussion about money, check out the Aspen Society on Linkedin.


And if you’re interested in learning more about investing, we’ll release our final 2021 education events soon. If you have any questions or suggested topics, please email us at



Debra Brennan Tagg is a CERTIFIED FINANCIAL PLANNER™ Professional and the creator of the DBT360 Financial Plan, a proprietary program that helps her clients prioritize their goals, leverage their resources, and address their risks. She is the president of BFS Advisory Group and teaches the public and the financial services industry about the importance of values-based financial planning and investor education.