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Ladies: When it comes to investing, are you a Panicked Paula or a Confident Kate?

6 minute read
By TD Bank Group
• Nov. 26, 2007
TD Waterhouse poll finds four distinct personality types among female investors - Most Canadian women are disengaged from investing, conservative and risk-averse - Yet more than half are happy or satisfied with their investments TORONTO, Nov. 26 /CNW/ - Four distinct investor types emerge from the 2007 TD Waterhouse Female Investor Poll, a comprehensive annual study of Canadian women's attitudes towards investing. They provide a psychological profile of how women perceive themselves in terms of engagement and satisfaction when it comes to their role as investors. "Successful investors are usually confident investors, and vice versa," says Patricia Lovett-Reid, Senior Vice-President, TD Waterhouse. "And so this year, we decided to use our Female Investor Poll to map women's levels of confidence in investing and understand what's going on in Canadian women's minds when it comes to their investments." Researchers used a simple formula (Engagement + Satisfaction = Confidence) to analyze responses to two specific questions: how engaged are you in investing, and how do you feel about your investments. From the data gathered, they arrived at a 'Confidence Map' of the Canadian female investor. The poll, conducted by TNS Canadian Facts among 995 Canadian women, found four investor personality types: Panicked Paula (36% of respondents), Blissful Betty (34%), Sleepless Sally (11%) and Confident Kate (19%). Panicked Paula: overwhelmed and confused Panicked Paula is disengaged from the process of investing, paying little or no attention to what goes on in financial markets, yet is still worried about the state of her investments. This investor type tends to be younger (33% are age 25-35) and less than one-in-ten have a financial plan. Not surprisingly, most (62%) have a low tolerance for risk, and, at $55,400, they have the lowest average household assets among the four personality types. "Clearly Panicked Paula is overwhelmed and confused by investing," comments Lovett-Reid. "That's not unusual, especially among younger women or those who are forced to get more engaged in their investments due to a sudden change in lifestyle. The most important thing for this investor is to take the first step. Meeting with a financial planner would do wonders to build both her confidence and her knowledge." Blissful Betty: disengaged, yet happy Blissful Betty, like Panicked Paula, is detached from the investment process and pays little or no attention to it. Yet unlike Paula, this doesn't worry her. On the contrary, she is feeling confident. Blissful Betty comes in all ages and has average household investment assets of $107,500. She is twice as likely as Panicked Paula to have a financial plan (one in five vs. one in ten) and has a low risk tolerance (57% define themselves as low risk). Blissful Betty worries Lovett-Reid. "Is she happy-go-lucky because she has delegated all responsibility for her investments to someone else? Or perhaps she hasn't considered the possibility that her life could take an unexpected turn such as divorce or outliving her financial assets? Either way, Blissful Betty needs to get more engaged in investing. Even if she has a trusted advisor managing her investments, she needs to be involved in the key decisions." Sleepless Sally: engaged, yet worried Although Sleepless Sally is knowledgeable, diligent and engaged in investing, she still worries about her investments. She is somewhat older than Panicked Paula (more than a third are age 36-45), and has, on average, more household investment assets ($137,200) than either Panicked Paula or Blissful Betty. One-in-four Sleepless Sallys have a financial plan. For the 75% of Sleepless Sallys who don't yet have a financial plan, Lovett-Reid asks: "What are you waiting for? Without long-term objectives and a portfolio strategy to meet them, you are living and investing day to day - and that is a recipe for insomnia." Confident Kate: engaged and confident Confident Kate is engaged in the world of investing, has taken action to ensure her financial security, and is happy about what she has achieved. She is typically older (four-in-ten are age 56-69) and has more than four times the household investment assets as Panicked Paula ($240,900 vs. $55,400). Half of this group has a financial plan and they have the highest tolerance among all groups for assuming a medium level of risk (57%). "Confident Kate is at a place all female investors should strive for: she's interested and engaged, confident and successful," says Lovett-Reid. "This is a wonderful place to be. My only concern is that I would have liked the Confident Kates to get here sooner. It seems like the classic case of 'with age comes wisdom'. From a financial perspective, wisdom and confidence really come from being engaged and making finances a priority." More Key Findings: - Seventy percent of respondents have little or no interest in investing, and pay scant attention to what is going on in financial markets. Among this group, roughly half are Blissful Bettys and half are Panicked Paulas. - Fifty-three percent of women overall are happy with their investments, yet only one-in-five (19%) are also engaged and interested in investing. - Sixty-six percent of women are married or living in common law relationships - this is the highest, at 70%, among Blissful Bettys. Yet only 16% of all poll respondents and only 15% of Blissful Bettys have a financial contingency plan for divorce. This compares with Statistics Canada's latest (2003) findings on marriage that indicate 38.3% of marriages will end in divorce by the 30th wedding anniversary. "On the whole, our 2007 poll found Canadian women investors to be somewhat less engaged than they should be in the world of investing," concludes Lovett-Reid. "They are conservative with their finances, and very few will assume high risks. As they get older, they naturally become more active and sure of themselves." "The challenge for financial advisors is to help women who are disengaged, perhaps lacking in confidence and younger in age to get in the game sooner and realize the benefits of a long-term investment horizon." The 2007 Female Investor Poll was conducted for TD Waterhouse using TNS Canadian Facts' online panel. Respondents for the survey were women aged 25 to 69 who have sole or shared responsibility for household financial planning or investment decisions. A total of 995 women participated in the online survey between September 14th and 19th, 2007. Final data are weighted to be representative of women by age and region. About TNS TNS is one of the world's leading market information groups, providing market measurement, analysis and insight through its operating companies in 70 countries. Working with national and multi-national organizations, we help our clients develop effective business strategies and enhance relationships with their customers. In Canada, TNS Canadian Facts provides full-service, primary market research. Its mission is to become clients' sixth sense of business(TM) by giving them a deeper understanding of their customers' behaviour, better anticipation of their actions and greater insight into what they really want. About TD Bank Financial Group The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Financial Group. TD Bank Financial Group serves more than 14 million customers in four key businesses operating in a number of locations in key financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust; Wealth Management, including TD Waterhouse and an investment in TD Ameritrade; U.S. Personal and Commercial Banking through TD Banknorth; and Wholesale Banking, including TD Securities. TD Bank Financial Group also ranks among the world's leading on-line financial services firms, with more than 4.5 million on-line customers. TD Bank Financial Group had CDN$404 billion in assets, as of July 31, 2007. The Toronto-Dominion Bank trades on the Toronto and New York Stock Exchanges under the symbol "TD", as well as on the Tokyo Stock Exchange. For further information: Stephen Ledgley, NATIONAL Public Relations, (416) 848-1376, sledgley@national.ca

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