Women Are Less Confident With Personal Finances

Illustration for article titled Women Are Less Confident With Personal Finances

Neither men nor women feel particularly confident about investment decisions, but women are less confident, according to study after study, including two new ones. Not everyone sees this as a bad thing, and yet it's arguably a mechanism of inequality.

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One study of 1500 participants found that only 26 percent of women felt confident about making their own investment decisions, while 44 percent of men did. Financial confidence was down overall. Interestingly, a separate study of 300 people found more than a confidence gap: It found a self-perception gap:

Women see themselves as more collaborative, while men see themselves as the decision makers. About 60 percent of married men said they make the investment and financial decisions in the household, the survey found, while fully three-fourths of married women said the decisions are made jointly.

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By those numbers, there's a dissonance in what men and women are defining as being "collaborative" versus singly-undertaken decisions. In any case, at least one expert paraphrased in the piece considers it a good thing that women across various countries are less "confident" in such decisions: "As result, they also are less like to jump in and out of investments trying to chase the highest returns."

In the immediate aftermath of the financial crisis, there was a lot of talk about how gender played into the risky, intemperate decisions made in major financial institutions, and how women's storied risk-averse behavior might actually prove to be an asset. By most accounts, nothing has really changed on Wall Street, but that doesn't mean that personal financial choices can't. Particularly in moving the needle to some productive place between timidness and overconfidence.

Girls Just Want To Have Funds [Chicago Tribune]
Earlier: Own Your Money Like You Own Your Sexuality: The Depressing Truths About Women & Money
How Wall Street's Men Act Like Menstruating Women

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DISCUSSION

kate-r
SeeKateTryNotToRunOffACliff

My BF and I just watched Too Big to Fail, literally 30 minutes ago. If you have HBO, you should watch this, as it gives a really clear account of the the Lehman Bros. bankruptcy and AIG bailout. I was working for a bank at the time, and even for our small community bank, those were heady days. We took a beating in the local press when we accepted $45 mil in TARP, and that's nothing compared to the big banks, who accepted $10 billion plus each.

I digress as that was slightly off-topic. What's interesting to me is that depending on where I have lived, women are more or less likely to talk about money, and I think this may have an impact on our financial know-how confidence. I grew up in the Midwest, in a fairly affluent suburb of Chicago, and no body talked about money. My parents never discussed it in front of us, or their friends, and my friends and I never discussed it, even when we got to college.

I've lived in Northern California for 13 years now, and it seems like everybody talks about money here: how much they are making, what their real estate value is, how and with whom do they invest. At first I was a little taken aback, and even thought it was a little gauche, but I have gotten over my lame snobbery and think that it really helps me gain confidence. Now, I find myself in long conversations with other female friends about 401k's and real estate investing.