Despite the many gains made in gender equality, affluent millennial women in the U.S. are more likely than other generations to leave important financial decisions to their spouses. A study by UBS Global Wealth Management found that 56% of well-heeled women between the ages of 20 and 34 looked to their spouse to make important financial decisions compared with 54% of women over 51. The study examined the habits of high-net-worth women who were married, divorced and widowed. In all age groups, 58% of the women surveyed across the world leave the most important financial decisions for their spouses to make.
Women give a number of reasons for taking a hands-off approach to long-term financial planning:
88% say their spouse knows more than them 76% say they are not interested in planning and investing 69% say they focus on other family responsibilities
Yet, most women surveyed have an understanding of the importance of long-term financial planning and 78% believe they will outlive their spouse. When asked to identify their top financial needs, 76% said retirement planning, 72% said long-term care and 68% said insurance.
It’s important to get to the root of why women are so hesitant to take charge of their finances, says Paula Polito, global client strategy officer at UBS. If we don’t, “this dynamic could go on for generations to come, unless both men and women make a commitment to engage in financial decisions together,” Polito says.
Interestly, while women are hesitant to get involved with long-term financial planning, they are more likely to handle the day-to-day finances. In fact, 85% of those surveyed consider themselves to be in charge of everyday expenses.
The study also looked at how a failure to be involved with important financial decisions can have far-reaching consequences. When asked about their lives after losing a spouse to death or divorce, 74% of widows and divorcees said they’d been on the receiving end of unpleasant financial surprises once they started handling their finances alone. Divorcees and widows also had some advice for their married counterparts, with 98% urging other women to become more involved in planning their financial futures. This advice is particularly important considering that women outlive men on average six to eight years, according to the World Health Organization.
Women who already do work in tandem with their partners to handle long-term financial planning together cite a number of benefits:
94% say they have higher confidence in their financial future 93% say their families have made fewer financial mistakes 91% say they are less stressed about their finances
Leaving the management of your long-term finances to a partner can hurt you in the long run. Not only might you make better financial choices than your partner, but you will be less knowledgeable about what to do if you’re forced to handle the finances alone in the future. Women who feel uncomfortable with their lack of financial knowledge can read books, take a class or even visit with a credit counselor or financial advisor to become more comfortable with managing money and making long-term financial decisions.