Women are no strangers to numbers considering that an overwhelming majority of them manage the monthly budgets of the household. And yet when it comes to investing in financial markets, they tend to lag men.

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Consider this: Women overall invest 40 percent less money than men, according to a survey by digital investment platform Wealthsimple.

What could be the reasons?

Lack of investment knowledge and confidence

Investing in the stock market requires the right knowledge. A study by FINRA Investor Education Foundation and George Washington University last year found women lag their male counterparts in investment knowledge and confidence. In a 10-question quiz measuring investment knowledge, the study found that only 8 percent of women versus. 21 percent of men got 80 percent or more answers correct. As much as 71 percent of men assessed themselves as having a high level of investment knowledge versus 54 percent women. Also, 49 percent of the men in the study felt comfortable making investment decisions, versus 34 percent of the women.

It takes time to study the terms and investment strategies, as the world of finance is full of obfuscating terms.

Goop quotes Whitney Morrison, a financial planner at Wealthsimple, reasoning: “If it’s confusing to the point that a regular person couldn’t possibly understand it, then you have to pay someone to navigate that for you, right?”

The obfuscating language, designed to be intimidating, is worse for women largely because there are fewer female financial advisors. Also, they may confront someone who doesn’t fully understand their concerns like longer life expectancy, taking more career breaks.

The most important thing women can do is simple: Educate themselves. There’s also a concept of passive investing: Invest across the entire market.

On top of that, women are less confident about investing. A Money Crashers survey in 2020 found the majority of men, 59 percent, preferred to manage their own investments versus 34 percent of women. The key reason women don’t know where to start.

Educating herself in the field will give her more confidence in investment decisions as well.

Women prefer safe investments

Women tend to have lower financial risk tolerance than men. It is all connected to men groomed into thinking they know everything and will make the right choice.

But overconfidence is one of the worst pitfalls of investing. So women are better equipped to invest, which should encourage them to start investing. Instead, women are scared. Too much caution makes them miss out.

Goop quotes Morrison giving a simple answer to the worry: “I think a great way to get acclimated is to start by investing a small amount. Money that, if the market goes down, you won’t panic about. Once you understand how the markets move, you can put more in.”

Pay gap between men and women

The investment gap and pay gap are closely related. It’s a well-known fact that women make less money compared to men with the same job and experience.

Also, women need to take much more time off work for family reasons than men. This creates a huge gap in wealth over a lifetime.

“If women earn less and don’t invest, the gap gets bigger and bigger,” Goopnquotes Morrison.

A recent study from Germany, referred to by Medium, shows that mothers earn up to 70 percent less until they are 60 years old. Even if women don’t have children, they earn 14 percent less than men until retirement. One child makes moms earn 43 percent less. A second child increases the gap to 54 percent and three children to 68 percent.

Less time

For women, the well-being of the family comes first, and financial wealth, last. After work, women go off to their second shift of taking care of children, housework, and cooking.

“I have to manage my two young kids and run the household, apart from managing my start-up that I run with my husband. Where’s the time to do researches and invest in stock markets. And I’m against paying commission to a third party,” says a young woman entrepreneur based in Noida.

But the irony is that despite investing less, there’s evidence that when women do invest, they’re better at it.

Why? For building wealth in the long term, one trait that matters the most is discipline. What’s more important is having a financial plan and sticking to it. Research suggests women are better at these.

So, women should invest in the stock market as it generates wealth. If women don’t invest their savings, they will become poorer. The stock market has given an average return of 9.5 percent in the last 90 years.

True gender equality will come only when women step up and start investing.