International Women’s Day might be all about female empowerment but when it comes to money in relationships, many women feel they need to ask for permission to spend.
According to research released today by Fidelity International women were less likely to feel financially independent than men with 27.4 per cent describing themselves as “completely independent” on their partner, compared to 35.3 per cent of men.
The report titled The Financial Power of Women, which looks at the barriers preventing women from investing, also found that while Australian men continue to dominate (bread-winner status 58 per cent male v 34 per cent female), women are more likely to consult with their partners on small purchases.
Of 815 women surveyed for the report, $343 was the amount they agreed was “too much” to spend without talking to their partner first.
By contrast men cited $594 as the limit that would prompt them to tell their partner about their spending habits.
When it comes to large asset purchases, 20 per cent of women said they were either sometimes, rarely or never consulted by their partners. Compared to 57 per cent of women who said they always were and 23 said they usually were.
“When it comes to men and women, it is clear from our research that they think about their finances differently,” said Fidelity International Managing Director Alva Devoy.
“Women tend to be more cautious and they worry more often about their financial future. Their main focus is on having financial security but they are less likely to see themselves as financially independent.”
The Fidelity research also supports global studies showing that women tend to be less financially educated than men, and this is largely due to men earning more on average.
Both are facts, which in addition to women having shorter working lives but longer life expectancy, puts them at greater risk of poverty and financial abuse.
Research also suggests that women are more willing than men to hand over financial decisions to a higher-earning and therefore “more educated” partner, according to a US survey by personal finance company CreditLoan.com.
But in an age where economic equality is increasingly sought after, particularly in the week where there is a push to support the hashtag #BalanceforBetter, women are also being urged to think and talk differently about money in relationships.
Many financial, and relationship experts agree that open and honest communication are key to minimizing arguments and potentially avoiding them altogether.
We need to get equality right when it comes to money matters in relationships,” says TBA Law solicitor Jacqueline Brauman.
“It is fairly typical for one of the parties in the relationship to take the reins of the finances, and where that happens, there needs to be clear communication and complete transparency.
“If you are someone who has handed over the control of the finances to your partner, then don’t bury your head in the sand completely about it. Still keep an eye on the bank accounts and the bills and the debt.”
The desire to find balance and improve your own financial independence in relationships can also be improved by considering five things before you next money talk.
- Talk openly about your individual financial positions
- Understand each other’s values, attitudes and financial goals, particularly whether they are aligned
- Identify how financially literate you both are, and areas where further education may be needed.
- Talk about the management of joint finances. Who will manage this, and ensure full disclosure.
- Talk about kids. Do you want them? Do you know the financial impact and how you might want to manage this?
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