Kathleen Murphy is the president of Personal Investing, a Fidelity Investments company that provides retail brokerage and other financial services to millions of individual investors. She spoke with the Associated Press about women, investing and more.
You come from a large family, how did that shape your view on finances?
I am one of six kids — three boys, three girls — just like the Brady Bunch of old-fashioned days.
My dad died at the age of 57, which really helped inform my view of what we need to do from a personal finance perspective.
My mom, who is a nurse, had to really deal with both a lot of issues associated with carrying on without him, including how to put kids through college while simultaneously saving for her retirement. Watching that up close and personal has made me passionate that women of all ages are both well educated about saving and investing as well as preparing themselves for the retirement they deserve.
What challenges are specific to women?
We have found through our research that women lack confidence in terms of investing.
Why? My firm view is that the financial services industry has underserved women. It feels impenetrable to women. They don't focus on the highs and lows of the market on a particular day. They focus on their goals, how to get long-term to a secure retirement, how to take care of their family. So our efforts are all about making sure women gain confidence by getting educated so they can feel confident taking the first step in the investing process.
There's evidence that when women do invest, they tend to outperform men. Is that correct?
That is absolutely true.
Women want to understand things before they take the first step. Men, in general, are willing to learn as they go. When women do take the first step, they feel informed and they have a goal-based approach to investing, so they tend to buy and hold. They come up with a plan and they stick with it. And I think over time evidence suggests that a long-term plan with a buy-and-hold (strategy) outperforms people coming in and out of the market.
What concerns do you hear about from investors?
For context, I listen to about 20 hours of calls each month as I am commuting. I do that to really understand more deeply what is on the minds of our customers and to make sure we stay ahead of the curve in terms of meeting their needs.
Some of the calls that stick with me the most are, for example, a fellow who has multiple sclerosis and daughters 10 and 12. And he turned to Fidelity for a managed account solution and said "You know, I'm counting on you to get my daughters through college." When you hear calls like that you get a sense of the deep responsibility we have to our clients to make sure we do everything we can for them.
Answers edited for clarity and length.