I’ve read several research studies on women and how they don’t engage with finances or don’t have enough saved for retirement. Some of these studies even feel free to pass judgment on women and what they should do.
But I think we’re looking at this stuff all wrong.
Are Women Less Competent Just Because They Feel That Way?
When women complete these surveys, they’re sharing what they feel. We aren’t measuring their actual financial acumen in a side-by-side comparison to men. We’re asking them where they think they stand in education and whether they think they’re ready for retirement. We're measuring their money confidence.
I’ve lived in the male dominated financial services industry for almost 30 years. And before I go on, let me say that I have a lot of male friends, a great husband, and many male colleagues for whom I have tremendous respect. But let’s think locker rooms or sports for a second. Guys like to put on a sense of bravado, and boasting, and wanting to be the alpha male. Women don’t. So fast forward to financial services, where lots of men put on that same sense of bravado. I know its just bravado – because I’ve seen a lot of real accounts managed by men, and watched the stocks for years just like they did.
Guys have more confidence, but I have yet to find them any better at money knowledge or ability. They like to talk about the great stock, or the great trade they made. They just fail to mention the 5 that went not so well. Women are more likely to worry about the 5 and beat themselves up. So when men and women answer what they feel about their money situation– is it a fair comparison?
Culture Bias or Ability?
We are learning that women with equal salaries are better savers than men. Many women have less in their savings – but this has more to do with being paid less than men, needing more flexible jobs so they can be the primary caregiver and taking time off to have all the wonderful kids we see around. This is more of a systemic bias in our culture than it has to do with a woman’s ability. If a man were in the same situation, where would he be?
Related article: What is it with Warren Buffet, Women & Money?
Women talk more about child rearing – in “female language”. Men don’t engage as much in those discussions. Men talk about money in “male language”. Women don’t engage as much in those discussions. I get that there are lots of people who need money education, but let’s be clear. It is much more about changing the language and building confidence in women than it is in their abilities.
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