Women tend to save less, retire on less and invest less than men, but it's not all bad news...

If I gave you £10,000 to invest, what would you do with it? Don’t get too excited, because I don't have £10,000 to spare. But I wonder whether your first thought would be to put it in a savings account or to buy shares? It’s a cliché to say that men are risk takers in life and women prefer security, but when it comes to money there is an element of truth in it. It’s partly because we’re more sceptical and/or cautious and prefer to find out exactly how much we could lose before we invest. But that’s not the only money difference between the sexes.

Where the differences lie
Women tend to prefer saving to investing but have lower levels of savings overall - according to National Savings & Investments' latest survey, 40% of women are saving regularly, compared to 49% of men, and women who saved set aside an average of £165 a month, compared to £220 for men.

A combination of factors comes into play; women earn less than men on average and for those who have children and give up work to look after them, paying into savings or investments is often one of the first financial sacrifices that’s made.

Women tend to:

• Save less than men. As well as earning less than men, we can sometimes be less disciplined. Men are better at setting a goal and doing what they need to reach that goal.

SAVVY TIP: Does this sound like you? Do you start saving but dip into your savings regularly? If so, make it harder to get to your money. I’m not a fan of notice accounts for emergency money but if you’re struggling to build up your savings and you have some cash for car/boiler repairs etc, choose a notice account where you’d lose interest if you withdrew money without giving the notice you need (it’s often 30 or 60 days). Or at least pick an account without a cash card. You can find best buy savings accounts, provided by Moneyfacts at SavvyWoman's Top Deals.

• Prefer cautious investments. Some women are very comfortable putting their money into stock market-based investments but many prefer savings accounts or lower risk bonds.

SAVVY TIP: There’s nothing wrong with being a cautious investor and how you feel about risk is very personal. If you do some research and then decide it’s not for you, that’s fine, but just make sure you don’t dismiss investing out of hand without finding out more about it. It doesn’t have to be all or nothing, you can start investing small amounts – as much as you feel comfortable losing – until you’ve got used to the idea. The independent Moneymadeclear website has some useful information about risk if you're new to investing.

• Manage their investments well. When women do actively invest they can generate as good a return, if not a better one, than men.

SAVVY TIP: This is why it’s not a good idea to dismiss investing. When women do invest, research shows women tend to outperform men. That’s because we tend to do more research than men and don’t waste money by buying and selling shares unnecessarily.

• Retire on less than men. There is a wealth of research, such as that by Scottish Widows, that shows women tend to retire on less than men. The bad news - for our finances - is we also retire earlier than men and live longer after retirement.

SAVVY TIP: It’s depressing to think that we’ll need more money to have the same standard of living in retirement as men but – sadly – it’s the truth. If you’re married or in a relationship you and your husband or partner may plan your retirement savings between you but if you’re on your own, it’s down to you to make sure you save enough.

• Prefer not to save in pensions. Some – although not all – women are wary about tying their money up in pensions for the long term. Although it’s definitely not a good idea to lock money away if you need access to it, you shouldn’t dismiss pensions out of hand.

SAVVY TIP: The rules state that you can’t access money in a pension fund before you reach your 55th birthday. If that worries you, you can always start saving in an ISA (a cash ISA if you think you’ll need the money in a few years time and a stocks and shares ISA if you can leave it for ten years or more) and then transfer it into a pension later on.

Useful links
The Sheconomics website has lots of information about women and money, including research carried out by Professor Karen Pine (one half of the Sheconomics team) called women’s emotional relationship with money.

SAVVY HELP: Denise Knowles, a relationship counsellor, and Karen Ritchie, an independent financial adviser with F-P-W are on SavvyWoman's panel of experts. Why not ask Denise or Karen a question about money and your partner by clicking here?