Tuesday, February 14, 2012

Do Men Really Manage Money Better?

This month’s issue of Black Enterprise features a new series on women and money entitled “Think like a woman . . .  manage your money like a man.” For obvious reasons, I couldn’t wait to sit down and read what revelations it would share.
The article states that “when it comes to finances women often wind up with the short end of the stick, whether the issue is salary, investing, big-ticket purchases, or family finances.” It goes on to say, “Often taken advantage of financially, women find themselves paying higher fees for products and services, earning less than their male counterparts and unable to support themselves through retirement.”  
I’m not trying to start a gender war on Valentine’s Day or anything, but by these statements alone is it really fair to assert that men “manage” money better?
For starters, if women’s earnings average out to be just 78% of male earning for identical positions, doesn’t that alone mean that if you make more, uh, you should end up with more? I’m not sure that this has anything to do with “management skills.”  Sure, women could stand to be more aggressive in the negotiation process, but this seems to me more like some tomfoolery going on in the human resources department. I may be too idealistic, but what happened to “Equal pay for equal work?” 
In addition to women earning less in general, we have to couple this with the fact that women will spend an average of 13 fewer years than men in the paid workforce. When children are born or elderly parents need care, no one tends to ask the spouse making $0.22 or more for every $1 to take time off.  And, if you don’t have a spouse to begin with, are you “managing” money poorly or do you just not have it to manage?
The mere fact that 21 percent of divorced women and 15 percent of widowed women live in poverty also says to me that if the assumption is that while they were married, their husbands “managed” the finances, then wouldn’t it again be his fault they are now in poverty? We know that women will typically live longer, so shouldn’t the husband in all his good planning be accounting for this?
Okay, okay. I think you get the point. I’m just not sure that it’s safe to generally say that men manage money better.  I definitely think men take bigger risks financially in terms of investing, while women tend to play the “safe” route and just save, but I have met many families, mine included where the husband takes a back seat to management because he admittedly is not that good at it. I believe the problem comes in when couples fall for the okie-doke and assume that the man will automatically be better at money management.  So, what do men do? In an effort to uphold the image, they pretend to know what they’re doing. The problem is no one realizes he doesn’t until it’s too late!
As many married folks will share and behavioral economists confirm, a major benefit of marriage is that it lets you focus on what you’re good at, whereas your spouse can contribute what they are good at. While my husband might be good at earning money, I’m good at running the household.  This is something we hashed out way back in premarital counseling. The key is that we don’t keep each other in the dark.  If anything ever happens to one of us, we each know how much we spend monthly, the location of savings, investments and insurance policies and how to access the funds. We sit down and discuss any changes, up or down, twice a month. We also discuss all major purchases and come up with a game plan together.
So what do you think? Do men really manage money better?  How does it work in your household?

Until Next Time,

Seek Wisdom, Find Wealth & Be Blessed!

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