Bolster Risk Management – Simplifying financial risk, insurance and investments for you.

Women and Money

Women and Money

How women manage money

Recently we had International Women’s Day and the Financial Services Council of New Zealand (FSC) encouraged businesses to promote and discuss women and money in the finance sector. This is important and relevant but is difficult for me to write about as a man without mansplaining (wow the autocorrect saw that as a real word!) and to really get to the heart of the issues.

There is no denying that there are clear discriminations when it comes to women and money and I will discuss these. I actively want to encourage women to have agency over their financial affairs. Read on, let’s see how I do.

Key ideas

  • “It’s a man’s world”
  • Facts, more facts and inference
  • Strong women help women get stronger
  • Keep It Simple

“It’s a man’s world”

Is it a man’s world? The answer now would be ‘probably’, but times are changing slowly and I believe for the better.

In 2018/19 when I was looking at the financial services industry, I was trying to figure out if I really wanted this as a career. Did I want to learn a new industry, maybe start my own business one day? Did I want to be ‘just’ another insurance salesperson?

I started taking note of the likes of the Financial Services Council of New Zealand (FSC) and Te Ara Hunga Ora Retirement Commission. They were doing some interesting work on financial literacy in NZ. While I was learning the ropes as a financial adviser, I was talking with people from all walks of life. There were people who had large incomes, yet they struggled on a week-by-week basis. There were single mums doing it tough, but showing great resilience and financial awareness. There were people starting out in their twenties showing more financial intelligence than I ever had at their age. The range of financial ‘success’ was vast, yet the majority of people, were struggling.

Many households have both partners working while trying to raise a family. There is pressure on the finances, pressure to do the kids’ homework, pressure to get the kids to sports training, fed, showered, birthday parties… seemingly endless things to do and think about. As a result, there becomes some under-discussed division of labour, where one person gets the kids to sport, while the other does things to keep the household running.

So the last thing many of these people want to do is to spend an hour with me talking about risk, death and disability scenarios. They have even less time to think about who is looking after the money.

Ah… let’s read that again: They have even less time to think about who is looking after the money.

However, in reality, someone, normally one person out of necessity becomes the ‘money person’ of the household.

Whether it is deliberate or by default it is typically the male who takes on this role. This is not always the case but studies have found that often when women hit their fifties and for whatever reason, their husband is no longer around, they are left on their own.  It is only then she realises that she doesn’t know anything about her financial position. This is a daunting and scary situation for anyone to be in.

That is why I decided, in the end, to make this industry my career, because I get to help bring about change, in whatever small way, to help everybody understand that your money matters.

Facts, more facts and inference

Social Structures:

The facts do not lie and these highlight that financial literacy is a big component of the ‘personal money management’ challenge, and I’ll discuss that in more detail later. However, there are also structural and societal forces that exist across the cultural divide.

For example, women experience pay inequity in the labour market and tend to be the family members who take time out of the workforce to care for children or older relatives, meaning when it comes time to retire they have less. We know this not just intuitively, but because a study by Te Ara Hunga Ora Retirement Commission has confirmed this.

The same findings also highlighted that women were disproportionally impacted financially by divorce and domestic violence. To top it off, women also bore the brunt of the COVID-19 crisis with higher rates of job losses than men.

None of these issues has anything to do with financial intelligence. Yet is it any wonder that over 8 of 10 women rate their financial wellbeing as being moderate, low or very low? Based on the uncertainties discussed above, is it any surprise that:

  1. Over 6 in 10 women worry about money daily, weekly or monthly
  2. Over 6 in 10 women don’t feel prepared for retirement

You can read the full report here from the Financial Service Council.

Financial Literacy

This comes up again and again that women have significantly lower financial literacy than men. It irks me to write this, because just by typing it, I feel that I am highlighting and labelling the issue even more. Almost as if, the statistics justify the reasons that women should not handle the household money, because statistically, they are less prepared.

That is most definitely not the case. Women have shown that they handle daily budgets far better than their male counterparts. Many studies on micro-credit or microfinance, show women are far more capable than men and are better credit risks.

That all said, the Commission for Financial Capability’s ‘Barometer Survey’ (2020) found:

  • Women have lower financial knowledge than men; twice as many men as women answered all questions correctly.
  • Women who have children have lower financial knowledge score than women without children.
  • Single women with no children have a higher financial knowledge score than women in a relationship.
  • The gender gap is largest in understanding simple and compound interest.
  • The gender gap is similar across all ethnic groups.

The financial literacy statistics for women do not look flash and this is only a part of the picture. Unpaid work, the gender pay-gap, low ‘money’ confidence and societal constraints also hinder progress.


Strong women help women get stronger

For a couple of weeks in March, I joined a few webinars about women and money, getting women into the finance sector and this one with Hilary Barry. One of the key takeaways from these sessions was there are strong women taking ownership, being comfortable in their own skin and owning their place in the world. This leads to other women standing up and starting to shine too.

Men and women think and communicate about money matters in varied ways. The FSC highlighted that “institutional trust issues lead to gender gaps in financial risk aversion, spending and saving preferences, further supporting the view that women manage financial risk, spending and saving differently to men.”

Jane Wrightson talking about her work at Te Ara Hunga Ora Retirement Commission (much of the above is drawn from their research), was empowering. Their National Strategy is focused on three audiences; women, Māori and Pacific Peoples.  By working together their aim was to demystify money, by using clear and consistent language. It might sound simple, but helping people learn about debt and saving, and understanding that through cultural behaviours and practises is not simple in reality.

The way forward is strong women helping others, leading the charge, not waiting for men to mansplain or direct them and for them to simply just get on with it.

Keep it simple

Things are changing slowly and taking small steps do make a difference. Many good ideas are simple. For a lot of us, trying to go up against institutional conventions and behaviours is daunting. Having open conversations with your spouse about money is a good start.

Creating a time and date in the family diary to have 30 minutes once a month may work well for your family. If you are on your own, don’t be shy with yourself. Face the situation that you are in, get real with where you are at. Then do a bit each day to make a change.

Maybe it is as simple as checking the bank balance daily so that you can track your spending. Or setting up a new account and automatically putting away $5 a week (or whatever you can comfortably afford). It could be reading the blogs of women who have gone through similar experiences as yours, learning how to make small changes in your behaviour. Find a voice that suits you and learn from them.

Having agency over your money is a powerful thing. No matter what position you find yourself in. Whether it be the comfortable ‘home executive’ or the single mum working three jobs, you both need to have a feeling of control. That and patience. Good change takes time.

So, at the risk of sounding like ‘that guy’, I’ll stop now.













Dominic started Bolster Risk Management to help people along their personal finance journey.

He believes that personal insurance is the bedrock to financial security and wealth creation. You have to protect your greatest asset, your ability to earn an income. 

Underpinning this is a philosophy that says Your Money Matters.