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Strategist: 'We need women to be investing at the same rate as men do'

Women earn about 82 cents on the job for every $1 a man makes. Over the course of a 40-year career, that equates to a woman earning $406,760 less than a man.

Outside of that women invest less money than men, which is a huge piece of what’s contributing to the wealth gap, according to Samantha Azzarello, a global markets strategist at JPMorgan Asset Management. Women are also more likely than men to leave the workforce for longer periods of time during their careers for child care or caring for elderly parents or a spouse.

“Being out of the workforce doesn’t just mean missing out on a paycheck,” she says. “It means not contributing to retirement accounts or earning social security along with the more obvious lost wages and wage growth.”

Azzarello said women just need to start investing as early as possible. “I do think for younger females, retirement and that aspect can feel very far off. We can feel very disconnected from that.” However, she stresses the importance of an early start.

Start investing early

One trend that could help is women are getting married later. The average age a woman gets married in the U.S. is 28 years old. That’s up from 25 years old just two decades ago and 22 years old in 1980.

“Women have a long period of time where they are financially independent and getting those pieces in order are more important than ever,” said Azzarello. “Women often feel like they need to know everything before they get started. That seems to be a big barrier that we have found with women starting to invest. The whole point is the mindset here is you don’t need to know everything, nor will you ever. You just have to start.”

When women start investing, they need to take on risk like their male counterparts, she said. “We know that women do not invest at the same rate or have the same risk appetite as men do,” said Azzarello. “We need women to be investing at the same rate as men do.”

Azzarello’s said women need to get a sense of money coming in versus money going out. That includes budgeting as well as planning for paying off debt like student loans. Have a rainy day fund in a high-interest savings account, setting aside for three to six months of expenses. And finally, said Azzarello, “Just be contributing to any kind of retirement account.”  

“It’s all being democratized at this point,” said Azzarello, referring to available investment tools. “We can invest cheaply, easily, in diversified portfolios so anyone can do it.”

Joanna Campione is a producer at Yahoo Finance.

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