Why Women With Money Can Create a Better World
It’s time to break down our biases.
Much of the research around how and why women feel the way they do about money management isn’t surprising to us women. According to statistics, 81% of women said they’ve personally been a victim of negative stereotypes – including about their investing abilities. And while this is extremely sad, it’s not surprising to most. I, too, have experienced this firsthand on more occasions than I care to remember, even though I am a finance professional with the experience and qualifications to back it up.
If you want to improve society, get more money in to the hands of women
Much of the research around how and why women feel they way they do about money management isn’t surprising to women. Statistics such as how 81% of women said they’ve personally been a victim of negative stereotypes, including about their investing abilities,(1) while extremely sad, are not surprising to most. I have experienced this first hand on more occasions than I care to remember. I am a finance professional with the experienc and qualifications to back it up. I remember how when I was talking to banks and brokers about obtaining a mortgage, as a regional head of finance, responsible for billions of dollars in company revenues, I expected to be taken seriously. But alas, no, every conversation was directed at my husband. I’d ask a question, and the borker or advisor would proceed to answer looking at my husband as if he’d asked it. It’s important to note the mortgage application was 100% based on my salary and would be my liability. It felt like the fact I was a woman overshadowing my financial credentials or experience. As a woman I could not possibly be the decision maker nor be capable of understanding the complex mortgage agreement.
So much of that bias is unconscious and it’s within men and women. We as women often display this bias against ourselves. We believe the stereotype that women are simply not good at managing money. That we cannot control our spending surplyes and are not good at investing. It’s widespread and crossed cultures, geographies and generations. When it comes to money, there is often a canyon of space between our mindsets and money belief systems. But why is this? Thankfully there is much research on this topic. Some of which I discuss here. I can recommend many books on this topic but if you are interested in understanding more, read this research compiled by Starling Bank in 2018;. Making Money Equa l It is jam packed with AHA moments you will want to read it again and again.
How are men and women different?
Women are socialised to save money, keep it safe and don’t be greedy. Our male counterparts are socialised to invest, seek out ways to earn as much as possible and be proud of financial achievements. For men, earning vast amounts of money is seen as powerful and impressive. Because of this women tend to hold 71% of their assets in cash, and shy away from sharing what we earn or have. Men on the other hand, hold 60% of their assets in cash( Male vs Female Investment Behaviour) and are more likely to baost about promotions and what they earn.
What I hadn’t considered before was our tendency to use our money to benefit everyone except ourselves. Studies have shown women use money to create a lifestyle in the present. We do that by buying the groceries, we make 70% of the travel decisionsPurchasing Power of Women, we organise the day to day lives of our families. That’s a different angle to the standard view portrayed in the media; that women spend all their money shopping and need to be given tips to stop or reduce. (queue eye roll to that massive sterotype).
On the other hand, we are less likely to plan for retirement, buy life insurance or be involved in arranging mortgages. While men use money to create a secure future. They take on the role of decision maker in long term significant financial decisions such as pensions, mortgages and life insurance. Women live longer than men, yet we are leaving our retirement security in the hands of the people we are likely to outlive.
Why do women feel less financially confident than men?
Money is genderless, it’s as much of a tool for women as it is for men so why do we feel so differently about it?This is where it gets particularly infuriating. It’s not just about gender pay gaps, there is a worrying gap in how men and women are spoken to about money. Men are thought the benefits of investing, blockchain, NFTs, while women are told to stop drinking coffee so they can save for a pair of designer shoes. Not that there’s anything wrong with designer shoes, they are a favourite of mine.
There was an excellent study carried out by Starling Bank in 2018. It found that 90% of articles targeted at females focus on small ways to save money. 71% encourage seeking out vouchers, discounts, and coupons to save money. 65% define women as excessive spenders, urging us to limit, restruct and take better control of shopping ‘splurges’. While our male counterparts are targeted with articles about the importance of making big investments, how to mitigate investing risks (50%), how money can enhance your status as a man, and 50% focused on how to protect themselves from future harm, including due to divorce. Is it any wonder arguements over money is consistently reported as the number one cause of divorce.
Why it’s good to get more money in the hands of women?
Firstly, we use our money to help others. Women will invest 90% of their income back into their families. While men reinvest 44%.How women can change the world with their money choices At first this surprised me but when I sat back and thought about this, it made sense. When my mother spoke to me about money it’s clear now she assumed my income would be used to pay for my families needs and I unconsciously absorbed that assumption. She urged me to always keep enough aside, just in case. And that was what happened. My income went back into my family. For years I didn’t invest or think long term either. It was a real wake up call.
Despite what is portrayed in the media, we are more financially responsible than men. When we do invest, we are more likely to invest long term, are more patient and achieve better returns. Studies show women are more likely to invest in ESG and sustainability so we use our money to invest responsibly and so are good for the planet. We use our money to help our families and our communities so communites thrive when women make more financial decisions. We currently control over $31.8 tillion in worldwide spendingCatalyst.or . Imagine the positive change we can create with that level of wealth if we felt empowered to use it in line with our values, strengths and to help others?
What can you do to feel more financially confident?
Put yourself on the path to financial wellness, by taking small actions you are able to now. To start what’s most important is clarity, it’s knowing how much money you have and then create a plan for where you want your money to go. Ensure the cashflow plan in line with your values, not what others or the media tells you it should be. Set financial goals that are true to you and then build your budget to achieve those goals. Make peace with your money situation and forgive any past mistakes, every human makes money mistakes. If you’d like to know more about what is financial wellness, get your free copy of my Conscious Finance Coaching Financial Wellness Checklist here:Consious FInance Coaching Financial Wellness Checklist
Remember ‘In order to succeed we must first believe we can’. - Michael Korda. I’m here to say, we can.