Why Do Women Take Fewer Financial Risks Than Men?

MedicalResearch.com Interview with:

Patti J. Fisher, Ph.D. Associate Professor in Consumer Studies AHRM Department Virginia Tech

Dr. Fisher

Patti J. Fisher, Ph.D.
Associate Professor in Consumer Studies
AHRM Department
Virginia Tech

MedicalResearch.com: What is the background for this study?

Response: Risk tolerance is one of the most important factors contributing to wealth accumulation and retirement. It is important to understand why women are less risk tolerant so that financial planners can better serve their needs because women, on average, live longer than men and often need more retirement savings.

MedicalResearch.com: What are the main findings?

Response: Women have lower net worth than men and a greater proportion of women experience income uncertainty. Net worth and income uncertainty are important in explaining the gender difference in risk tolerance.

MedicalResearch.com: What should readers take away from your report?

Response: Women and financial planners need to understand the differences in income uncertainty and net worth between men and women and the way in which these differences relate to risk tolerance. Although researchers agree that women tend to have lower risk tolerance, simply telling women to be more risk tolerant would be ineffective, and could encourage women to take financial risks that could lead to more problems in the future. Women should plan for income uncertainty by creating a financial strategy that meets their unique needs.

MedicalResearch.com: What recommendations do you have for future research as a result of this study?

Response: Which subgroups of women are more risk tolerant, and why there are differences in investment advice given to women and men. 

MedicalResearch.com: Thank you for your contribution to the MedicalResearch.com community.


Patti J. Fisher, Rui Yao. Gender differences in financial risk tolerance. Journal of Economic Psychology, 2017; 61: 191 DOI: 10.1016/j.joep.2017.03.006

Note: Content is Not intended as medical advice. Please consult your health care provider regarding your specific medical condition and questions.

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