Take Care of your Money!

by Natascha Zeljko

An appeal by Frauke Hegemann, team member of the board of comdirect

So let’s jump right in: why is it still so difficult to get women interested in finance? Why is there so much resistance?

I think there are two main factors. Firstly, very often the necessary knowledge is lacking, regardless of man or woman. And secondly, because the necessary knowledge is lacking, many women don’t have the courage to become active—which is what distinguishes them from men, by the way. This is precisely why role models for women are so immensely important. The problem is that if you don’t take care of your finances, the consequences are devastating. Periods of low interest rates and inflation really mean the destruction of money, which affects women with advancing age much harder. Additionally, women are fundamentally worse off financially; on average, they have 38 percent less wealth than men. Which means that if you don’t invest your money properly, you might be heading towards a retirement deficit.

Many studies have shown that women have better performance when they invest.

That’s true, these studies exist. We’ve found that women who take care of financial investments are at least as successful as men. This may also have something to do with our client structure because, as a direct bank, we don’t focus so much on classic branch customers. Our customers are more self-determined—you could even say more self-confident—when it comes to investment.

The individual handling of money also depends to a large extent on how one has been socialized. You grew up in an entrepreneurial family. How much did that influence you?

My mother had a medium-sized company, I grew up in an entrepreneurial household. Good management has always been a topic for us. We talked about the company, about the employees, about finances and the economic environment. I learned from an early age what entrepreneurship means, that there are good times and bad. That you earn your money and that you have to do business with it and work hard for it. And also that you have to make brave decisions, which is not self-evident. Such a home is very influential. If, on the other hand, a family never talks about money, something significant is missing.

Is it true that, as a child, you followed stock prices for of your mother?

Yes. My mom bought a small stock portfolio when I was maybe ten years old and I had the task of looking at the share price in the morning. That was in a daily newspaper as there weren’t computers or tablets at the time. After following that for a few months, I was able to tell her when it was a good time to sell. As a child, I was totally fascinated by the way such a course moved. That’s how my passion for stocks and the stock market began.

And at home: are you the finance minister?

My husband doesn’t like to hear it… but yes, that’s the way it is. I have a higher affinity for finance. And he also has complete confidence that I handle money responsibly.

Are there actually any peculiarities when it comes to investment behavior? Do women invest their money differently from men?

The issue of sustainability is very important. And women are more likely to invest in thematic areas. It’s called motivational investing–you invest according to your interests and convictions. You can inspire women with themes, with content.

Now it’s one thing to invest in funds or ETFs. What about trading?

There’s still an imbalance. The ratio between female and male traders at comdirect is one to four. Women tend to invest long-term and pursue the strategy “buy and let sit”. You can do that, but especially when you buy individual stocks, you have to take care of them and stay informed. Economic conditions and framework parameters are constantly changing; it’s part of the process that you follow this regularly. But with the technical tools that we now have, that’s not a big deal.

What is the overall position of women in the financial world? After all, Christine Lagarde is a woman in an important position.

I think that Christine Lagarde is a great woman in an important position. However, it’s always the same thing: as soon as a woman has such an exposed position, all eyes turn to her. By overemphasizing it so much, you make it an exception. I think it must become something natural, something that women take for granted to occupy such top positions. For me, this is more a question of attitude. Of course I’ve been socialized accordingly, but I have never questioned whether or not to pursue a career. For me it was always clear that I can do it! I believe we have to approach these issues with this attitude of self-evidence. We need more role models. Look at Angela Merkel—a female Federal Chancellor was, for a long time, inconceivable. And I know this “exotic status”—when I started in Commerzbank’s securities business for corporate customers, there were two women for every 140 men in Germany. I was sometimes the only woman at events, and being early twenties, was also extremely young.

What is the quota of women at comdirect?

For the Board of Managing Directors it is 25 percent: one woman, three men. And we even have 50 percent on the Supervisory Board, and we are also well positioned on other levels. In the Women-on-Board-Index, which is published regularly, we have been a leader for years.

Other companies still look pretty bad. The latest figures from the Allbright Foundation were not exactly encouraging. And yet a diverse team is good for the company’s success.

Absolutely. I have always made sure that I have well-mixed teams. But it’s not that easy in the financial sector because most women do the classic jobs like private customer service. Not to be misunderstood: those are, of course, important jobs. But just as important would be a higher proportion of women in investment or with corporate clients. And the fact that there are so few of them certainly has nothing to do with their inability to do so. I don’t think women have different talents; they basically have the same skills. I’m convinced that you have to encourage them more, that there have to be more role models. That’s where we have to start.

Last question: what do you want for the future?

So, first of all, I believe that things tend to turn out differently than planned. I’m not a planner. I’ve experienced it in my life that things can suddenly change. That also has something to do with my childhood experiences, that my father died so early on. But what I can say is that I have a super exciting job here in a great environment where I can develop and move a lot. I want to get more people excited about comdirect. I also have another theme close to my heart: our initiative finanz-heldinnen (“female finance heroes”). I have set myself the task of getting women excited about finance and motivating them to be courageous. I’m looking forward to that!

Tags: , , , , , ,