No pay gap in property - Why more women should invest

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ixty years on from the feminist movement that kick-started it all, women have come a long way in realigning the scales of inequality in both the workplace and society.

The number of women taking the action to invest is growing, with the Property Council of Australia reporting that women now make up 47% of all Australians who own property investments.

Despite this promising statistic, women often still face a number of additional challenges compared with their male peers when it comes to entering the property market.

An unequal footing

From the outset the gender pay gap in Australia is real. Lasted data from the Workplace Gender Equality Agency records the discrepancy for full-time paid work at 14% p.a.

Senior lecturer at Monash Business School, Dr. Carly Moulang argues that it is unreasonable to expect that women can invest on an equal footing as men.

"Savings and money for investments are accumulated at a disproportionately lower rate [by women] and this is due to the gender pay gap but also the impact of taking time out for family formation and other caring responsibilities."

Women also struggle to match the superannuation contributions of their male counterparts, having a marked impact on their financial position come retirement.

"Going into retirement, generally women accumulate significantly less superannuation compared to their male peers, whether they have breaks in their careers or not, and this further impacts their quality of life in retirement and their capacity to invest," said Dr. Moulang.

Seven barriers to contend with

Wealth mentor, Marian Mays is a dedicated champion of women's efficacy in finance and property and has identified seven distinct barriers working against women in this space (see table below).

7  barriers many women face when investing in property

Marian Mays founder of Thalia Stanley Group

1. Women earn less
   The gender pay gap is real and not an Urban Myth.
2. Women have higher living costs by virtue of being a woman
   Typically, the self-care budget is far less for a man than a woman.
3. A woman has less opportunity to save a deposit
   Typically, she earns less, her living costs are higher, and she spends more time out of the workforce in unpaid carer duties for children and family members.
4. Women generally have lower levels of financial literacy and investment know-how
   Typically in Australia, the only financial education a woman will receive is that passed down to her by her parents/caregivers thus the term “we inherit our poverty or wealth mindset".
5. Women are conditioned to believe investing is "not women's business" and consequently it is not their focus
   By default, it is assumed women's business is the business of having children, raising the family and being a caregiver rather than a provider.
6. The Financial Services sector is more supportive of the male
   Typically, he earns more, has a higher disposable income and spends greater time in the workforce.
7. Women typically have less self-confidence when it comes to investing
   Simply life is experiential- that is we learn in the process of doing and women for all the above reasons are not well practised in financial matters generally or making investments.

Recipient of the 2019 Financial Executive Women's national award for her contribution to the positive progression of women, Mays believes that it is a lack of confidence and financial literacy that underpins the inaction of many women.

"Women are taught from a young age to think that property is something you do with your husband or your partner," says Miss Mays.

"Property is a significant investment and [many women] are indoctrinated to think that they're meant to do it with two people or two incomes."

Financial illiteracy at epidemic levels

According to Mays, poor financial literacy is reaching epidemic levels across the county and is a major roadblock for many otherwise successful women.

"I'm not talking about uneducated women, I'm talking about women who sit in my boardroom who earn six figures, who are brilliantly skilled at their craft, be it a solicitor, a manager or a dentist or whatever.

"And they don't have the financial aptitude or the financial literacy to navigate making a $500,000 or $700,000 investment," Miss. Mays told API Magazine.

Women need to take the time to work on their financial literacy, not only to better their current outlook but also to safeguard against unexpected life events suggests Melinda Jennison, managing director of Streamline Property.

"It has been well documented in the past that women consistently score lower than men on financial literacy measures, and this obviously can have a negative impact on a woman's long-term financial well-being. Gaining knowledge of investment fundamentals helps to prepare women for uncertain life events."

"Women live longer than men and the threat of relationship breakdowns is also real, so being financially literate and understanding investments is crucial for long term security," said Ms. Jennison.

It's never too late

While investing earlier in life is obviously best and supports maximise capital growth opportunities, it is never too late to turn things around.

"When it comes to investing, especially in property, it's never too early or too late to map out a plan for the future. It's empowering to not be completely dependent on someone else to secure your financial future," said Ms. Jennison.

Real estate can be a great leveler

While typically women earn less than men, by leveraging their income to purchase property, it is possible to make up for lost ground.  Taking the time to focus and learn about finance and investing are the keys to unlocking a secure future, and for women, real estate really is a great leveler as there is no pay gap in property.

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rolific Sydney property investor and divorcee, Elaine Davis opens up to API Magazine about her upbringing, sharing her perspective on why so many women don’t invest, but should.

Growing up, do you feel that you were exposed to an adequate education in finance that would allow you to independently participate in the property market?

Absolutely not. In fact, it was quite the opposite. The way that I was bought up was to not rise above my station and to know my place in the world. This was the dialogue handed down to me from my mother and grandmother. There was a notion that it was embarrassing to get ahead.

Read Elaine’s full investment story here

Why do you think that so many women don’t invest in property?

While this intergenerational message has loosened up a lot now, I think there are still intrinsic beliefs held by some women that are holding them back.

I see it in Sydney, so many women who are earning really, really, good money, in their 20s, 30s, 40s, 50s but they just spend it.

And it’s sad because it’s actually a lot easier to save that you might think.

It’s really empowering when you see the savings grow. When you spend money on something, you might enjoy it for a week or so but soon it’s just an old thing in your wardrobe.

We exist in a culture of instant gratification and I believe that many women have a brain blank about getting ahead.

From childhood,  where boys were told, “you will be the breadwinner of the house one day,” girls were told, “you will meet a breadwinner one day”.

But these habits can be easily changed – it's just about questioning the dialogue.

Why do you think more women should purchase property?

You can’t put a price on the confidence that comes with buying a property and knowing you have an investment going up in value each year.

Whether it be by 100K or 50K or whatever, the freedom that provides is so empowering. The freedom to have the job you want and the partner you want.

Not having money drives you and makes you stuck. It creates a life of fear. Investing gives you choice, frees you up and puts you in control.

What is your best advice for other women looking to emulate your success?

Surround yourself with others who are succeeding. It doesn’t need to be in person, it can be in Facebook groups or online.

It’s not that your nearest and dearest are being unkind.  Often it is a case that they don’t want to see us fail and that’s why they can sometimes hold us back. They don’t want us to push ourselves but rather stay in the safe zone.

It is so important to be learning and hearing about the success of others. You need people around you saying, “that is a great idea, how can you make it work.” Not trying to talk you out of it.