Women have historically had the odds stacked against them regarding finances. It wasn't until the Equal Credit Opportunity Act passed in 1974 that women could fully open their own bank accounts or credit cards without needing a signature from their husbands.

The disparity has been even worse with the traditionally good ol' boys club of investing, which has remained strong for quite some time. That's begun to change, though. Women have had a major investing glow-up, and here are three things you should know.

1. More women are investing than ever before

There's been a significant increase in women investing in recent years. Historically, only 40% of women invested, according to Fidelity. In 2018, this number was 44%, and as of 2021, it jumped to an impressive 67%. That means roughly two-thirds of women are putting themselves in better positions to achieve more financial independence.

The stock market is one of the best wealth creators ever to exist. Investing in it doesn't guarantee you'll grow your wealth (or even make money), but it does mean you're taking steps to put yourself in that position.

Wealth aside, investing is important for maintaining the purchasing power of your money. Purchasing power is how much of a good or service can be bought with a specific amount of money. Most of the time, money sitting in regular savings accounts is losing purchasing power because the interest rate offered is below the inflation rate.

Investing is a way to beat inflation and build long-term wealth. The more women are doing it, the merrier.

2. Women are investing earlier

Not only are women investing more, but they're also investing much earlier. Women in the 18 to 35 age range first opened a retirement account at age 20, on average, and a brokerage account at 21. According to Fidelity, women over 35 first opened a retirement account at age 27, on average, and a brokerage account at 30.

Thanks to the power of compound earnings -- which occurs when the money you earn on investments begins earning money on itself -- that earlier start can work wonders.

Let's imagine two people invest $200 monthly and average 8% annual returns. Here's roughly how much they'd have at age 60 based on different starting ages:

Starting Age Years Invested Personally Invested Ending Value
21 39 $93,600 $573,400
30 30 $72,000 $271,800

Data source: Author's calculations. Rounded to the nearest hundred.

The nine-year difference between starting ages equated to around a $301,600 difference, even though only $21,600 more was invested. Needless to say, the earlier you invest, the better. Time (and compound earnings) can do much of the heavy lifting for investors.

Using our above example, even if someone starting at age 30 doubled their monthly investment to $400, they'd still lag by around $29,700 by age 60.

3. Women receive higher returns than men

Warren Buffett famously said there are two rules in investing: The first is not to lose money; the second is don't forget the first rule. And several studies have shown that women have been doing a great job at just that.

According to a Fidelity analysis of five million customers over a 10-year period, women outperformed men by 0.4% in 2021. A University of California, Berkeley study found an even larger difference of nearly 1%.

These differences may seem small on paper, but they can make a noticeable financial difference over the long run. If two people invested $500 monthly for 20 years, the difference between averaging 7% and 8% returns is more than $28,000 over that span. Even 7.6% versus 8% returns result in more than an $11,000 difference.

Maybe more impressive is that women have achieved these higher returns while taking on less risk, according to a Wells Fargo study covering January 2016 to December 2020. When looking at investment returns, it's important to consider how much risk it took to get those returns, not just the returns themselves. Less risk and higher returns are a two-for-one win.

There isn't a single characteristic to which higher returns for women can be attributed, but the glow-up is undeniable, given the facts. May the momentum continue in the right direction.