Are Women Better than Men at Managing Money?


Figures vary but, generally, women earn around 79% of a male salary. So, for every $1 earned by a man a woman will get 79 cents or less. While this creates significant inequality when it comes to income it hasn’t stopped women being better at some aspects of managing money than men. Of course not everyone is the same but these are a few of the ways in which women often have the advantage.

1. Women Are Less Comfortable with Debt

There are all sorts of studies to show that, when it comes to financial worries, debt sits at the top of the list for women. Men, on the other hand, tend to worry more about the wider economy. As a result, women can be better at keeping debt to a minimum. A survey, for example, found men have a higher average debt on their credit cards, compared to women.

2. Women Are Better at Saving

It would seem that women are often blessed with a much more long-term perspective and, therefore, more focused on ensuring that they save money to create an emergency fund. Women are more likely to participate in pension and savings schemes than men and to sign up for financial planning. However, despite this, men often end up with more assets and cash later in life. Why? It all comes down to earnings – men don’t just earn more, but also tend to have a longer stretch of uninterrupted time in the workplace.

3. Women Are More Cautious Investors

Automated investing platform Betterment established, via a survey, that women are much less likely to take risks when they are investing. Men will frequently switch investments and ramp them right up to the maximum, whereas women tend to leave initial investments alone. Investments left to perform can often produce more successful results, which would benefit women who do it. However, this does mean that women are less likely to generate a very large return on a modest investment, as that often necessitates risk.

4. Men Don’t save for a Rainy Day

On average, women tend to have higher balances in savings accounts then men do. Women are also more likely to have a financial cushion to cope with the unexpected events in life. Putting money aside is another area where women excel, with 37% of men having no savings at all for a rainy day, compared to just 30% of women. Households where women are in financial control benefit from this with 91% having a financial buffer, compared to 82% where the household finances are the responsibility of the man.

5. What We Can All Learn from These Traits

For anyone, male or female, there are some very positive lessons to be learned from this, including:

β€’ It’s important to "save for a rainy day" by creating an emergency fund

β€’ Long-term investors tend to be more successful but some risk will provide greater returns overall

β€’ Reducing debt is an important step towards being financially secure

β€’ Some kind of financial planning is essential if you want to get the most from your property, other assets and investments.