5 Reasons Women Can Be Great at Budgeting

Mon, Apr 21, 2014

Budgeting, Financial Advice

Almost everyone is aware that there’s still a significant gender gap in pay, but in recent years, studies by Financial Finesse (http://www.financialfinesse.com/), a provider of workplace financial education in the U.S., have revealed another disparity between men and women. Women lag behind men in several areas related to financial knowledge, confidence, and smart money practices. Although the gap has reportedly narrowed since 2010, studies in 2011, 2012 and 2013 showed that women still have a lot of catching up to do. While the 2013 report showed an encouraging reduction of the gender gap in investment habits and behaviors, the disparity remained high in basic money management, including budgeting. This is a problem both for women and society as a whole, as women on average live longer than men and have higher health care costs over the course of their lives.

Nature or nurture?

In this age of enlightenment and equality, why do women still lag behind men in money matters? It’s not because women are intrinsically incapable of handling finances. Sure, men’s and women’s brains are different, but much of the gender gap handling finances is a matter of cultural conditioning: a holdover from the days when men were the default heads of their households, bringing home the bacon and doling it out as well. As a result, males are still conditioned to assume more control over finances, even in two-income households.

Women are in the workforce in large numbers today, and according to some surveys, women have complete control over the family finances in slightly more than half of all U.S. households. Again, the money managing gender gap doesn’t bode well for families or society.

It’s not all bad news, though. Women who are motivated to do so can change their money attitudes and habits. Many have even leveraged gender-specific traits – whether culturally ingrained or hardwired – into strengths that have helped them become superb money managers, outshining men.

Five female strengths that can support smart budgeting

  1. Women are nurturing. While some may think that women’s nurturing tendencies make them less likely to focus on business and money, this isn’t necessarily true.  Many women have found that it is actually pretty easy for them to turn those tendencies to their advantage, whether they’re growing a business or managing a family budget. If they can condition themselves to think of their money as a tool that will help nurture their families and give them a secure future, they’ll be more likely to handle it with care.

  2. Women are detail-oriented. It’s been said that success is found in the details. Managing a budget involves keeping up with dozens of details large and small, meaning that people who are more detail-oriented could be better at handling budgets.

  3. Women aren’t afraid to ask for help. According to Financial Finesse, women have a slight edge over men in some areas, such as seeking out information about money management and absorbing that information. This can be a distinct advantage whether a woman is managing household finances or a corporate budget.

  4. Women have more realistic perspectives about debt. According to Financial Finesse, women seem to have more realistic perspectives than men about debt, specifically, about the acceptable level of personal, non-mortgage debt. This rational view of debt serves them well in managing a budget.

  5. Women are more risk-averse than men. Chalk it up to hormones, cultural conditioning, or a combination thereof, but men are more inclined to take risks with money than women. This audacity doesn’t always serve them well, even in the marketplace; some experts say that women make superior professional money managers. In any case, women can leverage their relative lack of bravado into a more balanced approach to managing family finances. Granted, some women may have to fight their affinity for “retail therapy,” but once they have that conquered they can use their risk-aversion to their family’s advantage.

Gender differences aside, some people are simply not very adept at budgeting. Not to worry: there are some clever tools that help make budgeting easier. If you are challenged by budgets, consider one of the several budgeting apps available for mobile devices; Mint.com is free, and HomeBudget is available for a small fee. For information about other budgeting apps see http://money.allwomenstalk.com/must-have-budgeting-apps.

Author Bio:

This is a guest post by Sarah Brooks from people search. She is a Houston based freelance writer and blogger. Questions and comments can be sent to brooks.sarah23@gmail.com.

 

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