ETFs May Present a ‘Compelling Solution’ for Female Investors

Exchange-traded funds can offer appealing advantages.

Reviewed by: Michelle Lodge
Edited by: Michelle Lodge

Betty Wang, certified financial planner, worked with a single-mom client who at first engaged in magical thinking about money. The client was so stressed about finances that she became paralyzed with fear and inaction when discussing investing, whether it be in stocks, bonds, exchange-traded funds or money markets. You all know how that works out: not so well.  

The scenario may be commonplace. “Stress” is the No. 1 word 46% of women use to describe their emotions around money, whereas 34% of men felt stressed out by money, according to the Fidelity Women’s History Survey 2023, released March 1.  

That finding isn’t surprising, because women were especially hurt early in the COVID-19 pandemic, as they were generally the first to lose their jobs and more likely to stay home to care for children and the elderly.  

Yet they also seemed to have bounced back more quickly than men as the pandemic surges have abated. According to the St. Louis Fed, by January 2023, U.S. women’s employment levels were higher than before the pandemic. 

The Fidelity survey also reported that women are upping their money engagement. As they do so, the ETF vehicle may offer many advantages that appeal to female investors. 

“As women feel more engaged in the financial planning process and understand the importance of investing in their future, ETFs can represent a compelling solution. There are passive ones, active ones, sector, theme-based, ESG and others,” noted Marguerita Cheng, CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland. “ETFs offer transparency, tax efficiency and intraday trading.” 

According to Fidelity’s findings, almost 90% of respondents say they have made money moves recently or are planning to within the next six months.  

“That trend is evident among Fidelity customers, with the number of retail accounts opened annually growing 65% between 2019 and 2022 compared to a 60% growth in retail accounts opened annually by men,” according to the survey. 

Amir Noor, a certified financial planner and director of financial planning at United Financial Planning Group in New York City, agreed with some of Fidelity’s key findings, as he noted he’s getting 30% to 40% more women as clients than he did five years ago, and they are more interested in saving and budgeting than in investing.  

Noor also understands the higher stress among women than men about money, as his female clients have higher expenses than men—childcare, medical care, hair and makeup. Although women still earn less (by about 18% annually) than men nationally, Noor has noticed that among his clients who are married (a woman and a man), the woman typically earns more than her husband.

The woman could be a software engineer or an upper-level executive or a doctor or dentist, whereas the man of the couple may be a teacher, blue collar worker or in middle-management. Even when both the woman and the man have the same job, a doctor, for instance, Noor said it is the woman who earns more than her husband.

More findings from the Fidelity report were that the most common money actions women have taken, or are planning to take, include adjusting spending habits, 66%; saving more for other goals, 60%; paying down debt, 60%; improving credit scores, 59%; and contributing to an emergency fund, 53%.  

Fidelity also reported that investments in retirement accounts among women are growing: IRAs opened annually by women grew by 60%, and contributions were up by 91% in 2022 compared with 2019. 


Follow Michelle Lodge on Twitter @lodgemich   

Michelle Lodge is a journalist who is a contributor to many sites: Fortune, Money, Time, Barron’s, Investopedia, and