Gender wealth inequalities

Before we get stuck into the thorny issue of “To Bitcoin or Not To Bitcoin?”, let’s take a look at the general landscape that this question is being asked in. Women are saving less for retirement but living longer than men. The pay gap is still high at 20%. And while governments are battling to reduce inequalities and forcing companies to do better, it will still take 100 years before we get to equality.

The figures are really worrying: women are saving three times less into their pensions than men - with the average women saving £24,900 compared with £73,600 for men - according to a report from pension provider Aegon. And it’s not for want of trying. We all understand the value of investing long-term and the power of compounding, but it’s hard to save effectively in the first place when that means managing to build an emergency fund and invest a lot of our savings from the outset. For most, that sounds like a big mountain to climb. If only there were a magic bullet to help us up the ladder, right?

Well, I’m wondering whether the answer is right here in front of us - Cryptocurrencies. We’ve all see bitcoin all over the news, with all the attendant praise and criticism of any new financial phenom. We’ve seen it rising and falling but not crashing [yet] and we’ve heard about people making a lot and losing a lot. But have we taken the time to properly explore this new crypto world?

That old (new) question: “Should I invest in bitcoin?”

I have been meeting hundred of women on this journey towards increasing financial independence for us all. And while we are all trying to get our head around saving, investing and talking about money more, there is one question that keeps cropping up: “Should I invest in bitcoin?”

It’s a subject popular at dinner parties but less often covered by your financial advisor. It’s not an easy one, to be honest, and when people ask me I have always replied... no. Why? Because before investing in anything, you really need to be sure it’s right for you, and I can’t know every questioner’s financial situation well enough to judge whether they are ready to go crypto… But with a few pointers, you can get the right answer for yourself:

An easy way to do this is to back to the golden rules of investing:

• Before you invest, determine your roadmap and investment strategy;

• What level of risk are you ready to take on?

• Consider building a balanced portfolio;

• Have an emergency fund in place and make sure high-interest / bad debts are repaid;

• And finally: if you don’t understand it fully - don’t invest in it.

The gender imbalance in crypto

According to Forbes, only 5% to 7% of all cryptocurrency users are women, making the industry a highly male-dominated one. According to the NextWeb, investors in Bitcoin only saw a wealth creation of $85 billion - of which [only] $5 billion or 5.88% was obtained by women.

Why are women not (yet) in crypto?

The main reason seems quite obvious and related to the gender imbalances inherent in both the tech and financial industries. Early adopters were coders who were sharing about the cryptocurrencies “on forums such as 4chan and Reddit - all of which have primarily male audiences”, according to NextWeb.

Also, the industry has failed to establish an appealing brand image for women. And as we know,  research has shown that women are generally more risk averse than men. But do these conditions really apply to you? They don’t have to. If we don’t consider the positive feedback some top female investors are now giving bitcoin et al, we could be losing out big time. As the venture capitalist Alexia Bonatsos wrote on Twitter, “Women, consider crypto. Otherwise the men are going to get all the wealth, again.”

We will continue to cover this ever-evolving topic on Vestpod, so email us if you are interested!