Women Aren’t Talking About Money – Here’s Why
A recent study by Fidelity Investments has uncovered some intriguing paradoxes about women’s relationship with money.
Despite the fact that 92 percent of the women involved in the study want to learn more about financial planning, and 83 percent want to get more involved in their finances in the next year, a whopping 80 percent admitted that they have refrained from discussing money with family and friends.
In addition, only 47 percent feel confident when talking about finances with a financial professional—compared to 77 percent who would be comfortable discussing medical issues with their doctor.
Where does this disconnect come from? Why are women eager to learn more about money, and yet reluctant to discuss it?
Fidelity’s study found that there are some common factors that make women closemouthed about financial topics: privacy worries and lack of confidence.
Privacy Worries
56 percent of respondents who have refrained from discussing finances with friends or family kept mum because money was “too personal,” while 35 percent didn’t want to share financial information with those they were close to, and 27 percent were raised not to discuss finances.
In addition, 32 percent of women feel uncomfortable discussing money, and 16 percent feel that the issue is taboo. 26 percent claim that the topic never comes up in conversation.
In short, it’s really tough to talk about money when we are socialized to keep this kind of information private.
Of all the reasons why we do not discuss finances, this is one of the most difficult to overcome. We worry that talking about money will make us vulnerable, make someone feel bad, or simply cross a tacit societal boundary—and those worries are not without merit.
So how do women overcome their financial reticence? Fidelity makes a couple of excellent suggestions for introducing financial conversations into your life without feeling overexposed:
- Find a Financial “Buddy”:By making time on a regular basis to discuss financial matters with a trust-worthy friend, family member, mentor or financial expert, tackling financial goals can become less overwhelming and more attainable. In the same way that “gym buddies” keep each other motivated, financial confidantes can help both parties make progress and stay accountable.
- Join an Online Conversation:Take advantage of online conversations with other women looking to get more involved in their finances, as well as experts providing insights and guidance.
Both of these options allow those who are interested in becoming more financially proficient to start and join conversations without feeling exposed.
Lack of Confidence
In addition to privacy concerns, women often have difficulty talking about money because they assume they do not know enough about the subject. 14 percent of respondents worry that talking about money would be a waste of time and 10 percent feel as though they do not understand finances well enough to talk intelligently about it.
According to Kathy Murphy, president of Fidelity’s Personal Investing:
“Beneath women’s reticence to talk about money lies a lack of confidence in their knowledge of financial planning and investing. This lack of confidence is really self-imposed. Our analysis of more than 12 million investors shows that women actually demonstrated stronger saving rates than their male counterparts and enjoyed better long-term investment performance when they did engage. Unfortunately, too many women still hesitate to take control of their finances.”
That confidence gap can feel like a Catch-22: you feel foolish for not knowing things, but asking questions feels too intimidating. So you continue worrying in silence and assuming you don’t know enough to talk intelligently.
But women have mastered many important money skills that they often tend to discount. According to Fidelity’s study, 82 percent of women are confident in managing their day-to-day budgets, and 74 percent are proactive about saving for the future. Women who are hesitant about making investment decisions simply need to build on the financial skill set they already have. Fidelity suggests several ways to do so:
- Kick-Start Your Financial Education at Your Own Pace:There are numerous tools, tips and reference materials online (like here at PT Money) which can help women boost their financial knowledge to the next level.
- Take Advantage of Workplace Retirement Guidance:Many employers offer on-site financial workshops and guidance, yet the study shows that sixty-five percent of women are not taking advantage of retirement guidance made available to them through their workplace plan provider. Check if your employer offers onsite financial workshops or 1:1 guidance, sign up if available, or contact a financial services provider directly.
- Work with an Expert:A financial professional can be a valuable resource to turn to with questions and to help build a roadmap for the future. When choosing an adviser, look for a good listener who communicates clearly about fees, professional designations, and investment advice. Interview the adviser before you make a commitment, to make sure you are comfortable and can build strong working relationship.
Take Action
The good news is that women are poised to take charge of their financial lives. Fidelity has shown that the majority of women already have great self-discipline when it comes to saving for the future—and they can apply that discipline to investing. According to Murphy, “The key is to take action now to ensure that your money is working just as hard as you do, so you can achieve the goals and live the life you deserve.”
Me too, Stefanie! I am always pushing other women to talk about it!!!
I’d be curious to know how many men talk about money. Apart from interaction with a couple financial planners, I don’t know of any men who say anything in regular conversation.
As far as women feeling dumb about money, everyone is born knowing nothing, you have to start somewhere. I saw a wonderful strategy recently. A single mom, after getting her house in order, spent a half hour each day studying about investing. Then she did put it into practice.
Oh man! This is such an important topic. Women do not want to talk about it. I was just like that. Starting the conversation, actually allowed me to see the full situation that we were in. And knowing that we could get our debt under control was empowering.
Someone just getting started with money can feel overwhelmed, the best plan is that one that will work for them. And keeping it simple means that it’s something that they can stick with over the long-term. Once you start to gain some success, then there is a fire inside to learn more.
Excellent post! As a woman who loves anything personal finance I often feel like an outsider. I don’t mind talking about my finances, and I LOVE talking about other peoples (or just finances in general), but it isn’t very often that I come across others who are just as open. A lot of it I believe is that they think they are doing so much worse than everyone else, but I think that in reality they are just uneducated. Education is key!
I am interested in money (earning it, saving it), but try to refrain from talking about this with friends since many are not doing that well financially and we don’t want to make them feel bad or get them to envy us. So we’re just doing the talking amongst ourselves.
I’m the big mouth who’s ALWAYS talking about money, and it’s exciting to see what kind of meaningful conversation that perpetuates. Any time I see friends, they’re telling me their latest budget strategy or expense fail- even if they’re experiencing set backs, at least they’re finally talking about it 🙂
Thanks for the tips! I think it’s in general seen as a faux-pas for people to discuss money openly, doubly so for women (people expecting the men in her life to take care of her financially, expecting her to worry more about kids than career). These are some solid tips for getting that conversation going.
How about for the men? I don’t normally talk about my finances. Also, it’s best to learn how best to manage your finances especially these days.
For me, gaining greater familiarity with financial topics and realizing that personal finance isn’t really a complicated mystery was helpful. I think there’s a prevailing societal belief that money shouldn’t be discussed openly–by men or women. That’s one of the reasons why I find online forums so helpful. People are much more willing to share financial advice online than in person.
Women are generally paradoxical, that said, the information you present in this piece about “women aren’t talking about money”, are very insightful. Thanks Philip….
Is this just a problem for women? I would think the stats for men would be pretty similar. As a society money matters might be our biggest taboo right now.