Sallie Krawcheck | 2018 MAKERS Conference
Sallie Krawcheck, CEO & Co-Founder, Ellevest, reveals an exclusive announcement
- Ladies and gentlemen, Sallie Krawcheck.
SALLIE KRAWCHECK: Good morning. Good morning. How are you? All right. I want to let you in on a secret. Money is power. Money is confidence. Money is independence. Money is taking care of our families. Money is starting our businesses. Money is take this job and shove it. Money is time's up.
Recently at Ellevest, my digital investing platform for women, we talk to 1,000 women and 1,000 men and ask the women, what is the thing that makes you feel most confident about achieving your goals in life? It was not what some of the media would make us think.
It's not our shiny hair. It's not the fact that we're wearing this season's new boots, though we are. It's actually not a lot of things we would think. It's not what's going on in Washington. It's not the support we get from our families. It's not even the salary we're earning at work or the esteem with which our boss holds us.
The number one thing that gives us confidence in reaching our goals in life is how much money we have saved, how much money we have invested, and the very act of investing in saving. Conversely, the number one source of stress for women today is money. And women can lose up to two weeks a year in productivity at work through presenteeism, worrying about money.
Now, the truth is, the guys have more money than we do by some good measure. And we've heard a lot over the course of the past couple of days. We've heard about the gender pay gap, which is a cause of it. We've heard a little bit about the gender work achievement gap, the gender unpaid labor gap. There's a gender debt gap.
And a couple that we don't talk enough about, but which is why I founded Ellevest and which is my life's mission, we have a gender savings gap and a gender investing gap, and these can cost us a ton. All right. Now, the good news is that society-- and by society, I mean the patriarchy-- lets us know why it's our fault that we're not saving and investing enough. So they're very helpful to us.
One thing they tell us-- super helpful-- is society lets us know that just men are just better at math than women are. Not true. First of all, we get better grades than the guys in every subject at school. And in math, sometimes we get the same. But it's not that they're better at math and math-like things or tech and tech-like things than we are.
Society tells us they're better investors than we are. Um, not true. When women invest, we tend to outperform the guys. Be that as a professional hedge fund manager, mutual fund manager, or individual investor. You know the articles you read about how individuals, people investors, fall in love with their winners way too long to sell the losers, pay too much in fees, panic during the up and down markets of the past few days. Right?
How investors do that. We need to change the title of all of those articles to not mistakes investors make, but mistakes male investors make. Because the mistake we tend to make is we don't invest enough. Women are more risk averse than men. You've heard that before, right? There's something about having a uterus inside our body that does not allow us to take on risk. So we don't invest. It's perfectly clear.
Wrong. Wrong. We're not more risk averse, we're more risk aware. And so while the men in our lives, whom we adore, will hear alpha and they're like, I want some of that. And standard deviation, I want some of that, too, don't I? We women-- because I know everybody here got their A's at school-- want to understand more about investing, want to understand those terms before we do. Once we invest, we don't take on any less risk than the guys do.
Not investing is more certain. Sort of. You know what's certain? If you keep your money in cash, you lose ground every day to inflation. But that if you invest even with the markets of the past few days, even back to the '20s, '30s-- from the 1920s, the annual return in investing in the equity markets is 9.5% annually. A diversified investment portfolio is 6%. These are life changing numbers.
The other. Women love everything about Wall Street. It must work for them. That outperforming thing, the buying the winners, the winning, right? That feels like us, right? CNBC, we love them. They're like ESPN. That feels like us, right? The fact that financial advisors 86% male? Mostly white men? That feels like us, right?
Now, I have nothing against middle aged white guys. I've been married to a couple of them. They are amazing creatures. My, my husband's the whitest man I know. Amazing creatures. But it doesn't look like us. And the industry symbol is an anatomically correct bull. It's a phallic symbol. All right? Not a woman I know says, that bull just speaks to me. It hasn't been built for us.
All right. Let's move from a little myth busting to a little call. I'm going to ask you, I'm going to give you an answer and you're going to give me the question. OK. So a little game just to liven things up. First one. Let's see who can get this. Six to eight years and 80%.
Y'all are not very good at this. Here is the answer. How much longer do women live than men, and what percent of women die single? We live six to eight years longer than our male friends, and 80% of us die single. Look at any nursing home.
Two thirds. OK. I'll give you the answer again. Two thirds is the percent of wealth versus men that we retire with. Put another way, we retire with two thirds the money of men. Less, and quite a bit less, if you're a woman of color. We live longer, we retire with less.
90%. The percent of women who manage their money on their own at some point in their lives, whether they want to or not. A decade. Y'all are the worst. A decade. This is how much sooner our salaries peak than men's do. Our salaries on average peak in our 40s, and for men it's in their 50s.
More than $1 million. This is how much the gender investing gap can cost the women in this room. For those who are watching, for some of you, it's hundreds of thousands of dollars. For some of you, it's millions of dollars. It's a fortune. It's a life changing amount of money.
$100 a day. For those of you who don't like big numbers, I'm sharing with you a small number. This is the amount of money we lose a day. If we're making, let's call it $85,000 a year, putting aside 20% as the experts tell you to annually. We put it in a bank account rather than invest it. We wait 10 years to invest, which isn't off by much. We can lose $100 a day.
Let me ask you a question, ma'am. If you were to have a hole in your purse and you were to leave here today and a $100 fell out of it, and the next day another $100, and the next day another $100, how many days would it take you to fix your purse? Probably one day.
Sex. Come on, you've got to have the answer for this one. Sex. The thing we talk to our girlfriends about more than we talk about money. The thing we have with a potential partner well before we ever talk to them about money. Society has allowed us to talk about sex, but not about money.
By the way, imagine-- on what date do you have sex these days? I've been married for so long. Like second, third? Third, sir? Second? All right. Thanks. All right. That guy's like [INAUDIBLE], right? Imagine if on the second or third date, rather than getting cozy all of a sudden we were to say, let's take out our balance sheets. There would not be a next date.
So society tells us, the patriarchy tells us almost as if they meant to keep us away from money that talking about money is crass and unattractive. This is like 1950s June and Beaver Cleaver. Don't talk about money. Well, guys, how do we know what raise to ask for? How do we know how to invest if society tells us not to talk about money?
And so what you saw before is we're working to change that. We're working to break through the myths. We're working to drop some truth bombs. We're working to give advice. And I promise, we're working to make it interesting, and fun, and engaging.
I'm partnering, Ellevest is partnering with our friends here at MAKERS, with our friends at Yahoo Finance, to bring you MAKERS Money. And in MAKERS Money, we're going to have some bad ass guests. Luvvie Ajayi being one of them. So bad ass. And we're going to be talking about how we can have more money.
It starts tomorrow. It's going to be Thursdays 3:00 PM Pacific time, 6:00 PM Eastern time, and every Thursday from here on. And I would ask all of you please to pour yourself a wine. We're doing it in the early evening on the East Coast time. Bring a friend, start the conversation about money, and continue the conversation about money.
Share the episodes with other women because it's going to be targeted to women and our unique needs with younger women in your life. And send any questions you have to me at email@example.com. And share using the hashtag, #makersmoney.
The other thing I would say, Ellevest, it is my life's mission to close the gender investing gap. If you are not investing enough, please go to ellevest.com/makers where I've got a little present for you, including a free investment plan, but an even other good present to give you back some of those days where you haven't been investing.
We are super excited because, ladies, money is power and it's time to level the playing field. Thank you.
2018 MAKERS Conference
MAKERS amplifies the dialogue around harassment, equal pay and other urgent issues, pushing the women's movement forward. #RAISEYOURVOICE