Christopher Johnson: Welcome to Morningstar Studios. Today I'm joined by Alexia de Broglie, the co-founder of the personal finance app, Your Juno. Alexia, thank you so much for being here with me.
Alexia de Broglie: Thank you for having me.
CJ: So, my first question to you is that you co-founded Your Juno with your sister, Margot. Why was it so important for you both to build an app dedicated to women and helping them understand more about finance and investment?
AB: It's really interesting. So, the moment that we had the idea for Juno was just after COVID happened and the markets came crashing down. Both my sister and I have a background in finance and so what we noticed at that moment was that there was a huge interest from people from my generation around the topic of investing. But the conversations that were being held between my male friendship groups and my female friendship groups were completely different. So, a lot of my guy friends had WhatsApp group chats where they talked about crypto, they talked about investing, what stocks to pick, et cetera. And then a lot of my female friends would message me being like, what is a share, how does this thing even work? It was very sort of two different levels.
And so, I started looking into it and I discovered that the financial literacy gap is massive amongst men and women in basically every single country in the world. And it's leading to women missing out on wealth building opportunities that would maybe correct the gender pay gap a little bit. So, women are currently paid in the UK 14% less than men, but the actual gender wealth gap, so how much women own compared to men is 35% lower. So, you can see how the differences in pay are actually compounding over the lifetime and that there's really only one thing that can fix that outside of systemic change, and that is giving women the tools and the confidence to be able to put themselves in the best financial position.
CJ: Where do you think the gender gap originates from?
AB: Oh boy, that is a long question. There is a lot of different gaps that we can address here. It starts incredibly young. So, girls receive 20% less pocket money than little boys. Girls are taught about saving whereas little boys are taught about what careers they're going to be doing later on. And then that gap just widens over time. So, if we think of the way in which, sort of what careers women choose, what university education they go into, society typically values male dominated industries more than female dominated industries. And there's really this idea that women's labour, oftentimes being caring for loved ones and upholding the family, is unpaid labour. Whereas male's labour typically is considered higher capitalistic value, I guess if you want to call it that way. And so, women are being paid less and that obviously over lifetime becomes bigger and bigger. Women take more career breaks than men do because they look after loved ones. Obviously during those times they're not contributing to their pensions, they're not building up savings. So, women end up retiring with investment pots that are one-fifth the size of men's, which is huge.
But then there's also sort of smaller elements that go into it, which are things like women typically spend on household items. Whereas men – in heterosexual relationships, men tend to spend on investment items. So, what I mean by this is women will be the ones going to the grocery store, whereas men typically might be the ones that will pay off the cow, pay off the mortgage. And the problem is that when you get to the age of divorce, what happens? Women have nothing to show for. They've spent all of their discretionary spending for the family, all of the food, et cetera. That's gone. Whereas oftentimes men will be the ones that have a higher percentage of the mortgage that they've paid off over time. So, they actually have an asset to show for. And so, there's also this imbalance, the fact that they're not using their money in the same way and that women typically spend on stuff that won't increase in value over time.
CJ: How did your upbringing shape you and your sister building this app to help other women understand more about finance?
AB: We grew up in a household that was led by a single mother that absolutely adored the topic of money. So, she did not have this conception that money is dirty or that money is taboo. And so, we were looped into household finances from a very early age. And actually, my sister and I, when we were about 12 years old, approached my mother and said, hey, we've built this budget on how much money we would need per month to pay for clothes, to pay for shampoo, toothbrush, school accessories, going out with friends, whatever you do when you're 12, basically getting candy, and we built this budget, and she was really impressed and said, okay, fine, I'm going to get you both a credit card – completely illegal, but why not – in her name, and you're going to now essentially be managing your own money from the age of 12. So, we got rent and food covered by her and then the rest was on us. And so, I remember taking the bus with my credit card in my mom's name and going to the supermarket and buying my toothpaste and my toothbrush and trying to figure out how this is going to fit into my budget.
And I think the main thing that it taught us is one, of course, we are able to manage money. Me as a young woman, I have the capacities to do it. But also, as I grew up, I noticed that I spoke to my girlfriends about money. I didn't have this feeling of shame or of guilt associated with finances. And one thing that I've learned from running the Juno community is that there are so many women that are deeply indebted, and I'm sure men as well, and that are not speaking to anyone about it. Money is the number one source of stress in the UK. It's the number one source of divorce in the UK. And so, we really need to create spaces that lift the money taboo and that give us a non-judgmental learning space.
CJ: What do you think we need to do as a society to improve the personal finance education for women specifically?
AB: I would like to look at it in two ways, beyond just financial education, but also just financial products and their uptake, because that's a huge problem. What can financial institutions do to create more inclusive products and really tie women into the world of finance? For me, there's one, obviously there's the product. Who is building the product? At the moment, there's 30% of women in the financial industry. At positions of leadership, that becomes even less. There's only about 1.2% of startups in the world of finance that are funded by women – founded and funded. When we look at who is using the products, we see that women only make up 24% of investment app users. So, obviously, the people that are building the products are mainly men. The people that are using the products are mainly men, so that means that the data that people are looking at when they're informing future product decisions is male-led data. So, that's a huge issue in and of its own, is how do we make sure that when we build products, we have women making decisions, we have women that are being spoken to, and we filter the data to look at gender differences and making sure that it also targets female problems.
Then the second big piece, which goes more into what you mentioned, is how do we communicate about money, how do we teach about money, how do we get women to use financial products? Here, what's really interesting is that women have been considered as a niche for a very long time. So actually, when financial institutions communicate about products, they don't necessarily have different strategies for men and women. They're using this blanket strategy. And so, they're using language that doesn't resonate with women. If you think of the world of finance, there's a lot of language around war language, sports language, betting language. It's always about beating the market, even just bear and bull market. It's so manly, and it's really alienating 50% of the population. A lot of times women, they care more about long-term safety. They care about looking after their communities and loved ones. They're not caring so much about the status, the power, the ego, which is what a lot of the financial industry taps into to get male customers. So, I think we need to completely rewire the way we think about money for women and accept that they have different motivations and then build different strategies for these different segments.
CJ: My final question to you is, I was at All Things Money by our friend, Olamide Majekodunmi, it's one of her events. Your sister was speaking at this event, and she talked about the fact that people underestimate the power of finance to shift the conversation to create positive change. So, what would you say to those people who want to use their personal finances to maybe move the needle on certain issues that matter to them?
AB: It's a really interesting question because there is a lot of unknown territory in how to green your money. I think when people think of money, there's three things that they can look at. One is how do they spend their money, and this is where a lot of the current emphasis is. Make sure that you spend on ethical products. But there's actually two way bigger buckets, which is one, where do you save your money? What bank are you banking with? Because the money that is in your savings is being used by the bank to invest in other stuff. And the problem is that the big banks in the UK are using it to also fund fossil fuel, to fund deforestation, to fund things that you would never want your money to fund.
And then the third one, which is by far the most important one, is where is your pension? Every person in the UK – not every person, but almost every person in the UK has a pension, which is money that is being invested for your future. And the problem is that most of the big pension providers invest in everything, which means they're investing in some good stuff, which is fantastic, but they're also investing in a lot of, like I said, fossil fuels, deforestation, projects that you just wouldn't want your money to go to, weapons, gaming, et cetera. And when we look at the data, we've realized that 80% of people in the UK don't know where their pension is going. And what is even more shocking is that changing pension provider and making sure that your money is invested ethically is by far the most powerful thing you can do to reduce your carbon footprint.
So, there was a study that was done by Make My Money Matter. They looked at it and they found that changing your pension is 21 times more effective at cutting down your carbon footprint than stopping flying, going veggie, and changing energy providers combined, which is insane if you think about it. Everyone would do it if they knew about this. The problem is it's not discussed. They found that for each person in your pension pot on average, £3,000 are invested in fossil fuels. Two out of £10 are invested in deforestation. And obviously, if people knew about this, this is the first thing that we would be sort of hearing about and everyone would be outraged by it. So, I think we need to put more emphasis on greening your pensions, writing to your pension provider, making sure that they know that you're outraged by this, and also just looking at who are the more ethical pension providers that you can choose.
CJ: Alexia, thank you so much for taking the time out to be here with me.
AB: Thank you so much. I appreciate it.
CJ: This is Christopher Johnson from Morningstar UK.
