Men and women have different ways of approaching financial management which can cause some challenges when they need to work together. This week on our Live, we hosted Kirk Chisholm from Money Tree to discuss the gender differences in approaching financial management.
Due to societal pressure, men might feel a greater pressure in providing for the household. This can also reflect on managing money, especially after retirement. Once men retire, they might feel the gap of not being able to financially provide for their families which can create emotional struggles. Compared to women, this emotional challenge can be more significant for men as they don’t tend to open up emotionally as much as women do. To solve these emotional barriers around sharing financial responsibilities, men and women need to remember that often we have different communication styles, and this will make discussing money an even bigger challenge in relationships.
Women also tend to be more conservative in investments compared to men as they want to get more details before making an investment decision. This might limit their investment growth opportunities compared to men but can also be useful in assessing risk. However, this could lead to financial disputes in the relationship, if the women feel her partner is being reckless in making investment decisions on behalf of the family. On the other hand, higher risk investments may lead to better returns for the couple. There is no easy answer here because the couple will need to figure out how to address and respect each other’s comfort levels when it comes to investing and get the other partner on board. The good news is by working together, men and women can use their different perspectives to make better investing decisions for the benefit of both partners.
In most couples, financial decisions are managed by one of the partners, regardless of gender. Without both partners being involved in managing money, there can be confusion and underlying assumptions that may cause both partners to spend and save in ways that may place their financial goals at risk.
To have both partners involved in finances, couples can decide what parts of the budget they will work on. For example, in some relationships one person may pay the bills while the other is responsible for making investment decisions. This can allow both partners to be involved in the process without getting overwhelmed by having every detail. Even working on a part of your finances can provide you with some clarity on where you are financially at. This also gives accountability and responsibility to both partners.
One challenge some couples may be facing due to lack of accountability is one partner spending more than their budget can afford. Some couples try to solve this challenge by giving a spending limit to both partners which can both assign accountability to each partner and helps them to focus on their joint financial goals.
Whether you are the breadwinner or not, you need to know the income and expenses of your household to be financially aware and contribute to your financial situation. Even if you are not the bread winner of the household, understanding your income and expenses can help you identify unnecessary costs and cut down your expenses to improve your savings.
Being on top of your finances is not only important to be aware of your situation but also to be prepared for financial risks you may face such as job loss, health loss or divorce. If you get divorced from your partner that has been managing your finances, you might find yourself feeling financially vulnerable. Ways that you can share financial responsibility is to set up a joint account for joint expenses, joint investment goals and joint fun goals. You may want to set up separate accounts for specific financial goals you may have for yourself. This is a common practise in many relationships where both partners earn their own income. If you are not involved in the finances of your family and you are the primary caregiver, it is a good idea to learn more about the family’s finances by communicating with your partner about how finances are set up, where finances are located and how you can get more involved in the financial management of the household.
Whether you are the breadwinner or not, you need to know the income and expenses of your household to be financially aware and contribute to your financial situation. Even if you are not the bread winner of the household, understanding your income and expenses can help you identify unnecessary costs and cut down your expenses to improve your savings.
Being on top of your finances is not only important to be aware of your situation but also to be prepared for financial risks you may face such as job loss, health loss or divorce. If you get divorced from your partner that has been managing your finances, you might find yourself feeling financially vulnerable. Ways that you can share financial responsibility is to set up a joint account for joint expenses, joint investment goals and joint fun goals. You may want to set up separate accounts for specific financial goals you may have for yourself. This is a common practice in many relationships where both partners earn their own income. If you are not involved in the finances of your family and you are the primary caregiver, it is a good idea to learn more about the family’s finances by communicating with your partner about how finances are set up, where finances are located and how you can get more involved in the financial management of the household.
Most people tend to prefer having conversations about money when they are in a good place financially compared to when they are having challenging times. However, talking about your finances openly with your partner is crucial regardless of the situation. If you are having financial challenges, clearly discussing it with your partner may help them understand the situation better and collaborate with you on finding solutions. Having money conversations when you are doing well is also very important especially because financial circumstances can change quickly (we all learned this during the pandemic) and your partner lack the financial confidence to deal a drastic change in the family’s financial position.
If you are feeling defensive about having money discussions because of the misalignment between goals, focus on the problem instead of blaming the person’s decisions. This can help you and your partner to feel better about making mutual decisions instead of using blame and guilt. Also try not to have money discussions when you are already feeling anxious about your finances. Wait until you calm down first with the goal of creating a better outcome after the discussion.
If you and your partner have very busy schedules, schedule a regular meeting to have these financial discussions and create an agenda to address the pressure financial issues of your family. These meetings can take place monthly, weekly or annually. You choose…By arranging recurring meetings you can work through financial topics in a focused manner compared to shorter and instant conversations that might not get you results.
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