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07 February 2011 |
"Sometimes I wonder if men and women really suit each other. Perhaps they should live next door and just visit now and then.
"Sometimes I wonder if men and women really suit each other. Perhaps they should live next door and just visit now and then." Katharine Hepburn
According to an article in the Wall Street Journal last week, when it comes to being economical with money, men and women are often just as economical with the truth. One third of a survey of married couples found that individuals kept secret accounts, lied about their earnings or hid their latest purchases from their partners. I imagine the following generic conversation will be familiar to most people (delete as appropriate).
"Is that a new dress/bracelet/set of golf clubs/electronic gadget made by Apple?"
"What, this old thing? Nooo, it's been in the back of the wardrobe/tucked in a drawer/outside in the garage/around for years."
"Mmhmm..."
Although it seems that both men and women are equally deceptive with their personal riches, the article continued to highlight significant gender differences when it comes to spending household money. The traditional evolutionary distinction between the sexes broadly labels men as hunter-gatherers, whilst women focus on caring for offspring. This generalisation appears to still have some truth in it; recent studies show that money transferred to mothers as part of anti-poverty programs usually goes on food, children's clothes and school supplies. Even when the survey participants are wealthier the trend continues; when a woman is in charge of a couple's 'disposable income' accounts, money tends to be spent on family-targeted possessions like washing machines and kitchen appliances.
It is interesting to note that only recently have gender approaches to money become a topic of focus by behavioural economists - even influencing how some policy-makers and organisations around the world allocate their funds. Conceivably then it wouldn't be too much of a stretch to apply this same thinking to the investment world. Here too, there are striking differences between the male and female approach. The results of one study by BlackRock at the end of last year showed that women were more cautious investors, with only 9% of females saying they were very aggressive compared to 21% of males.
However, as we know, 'aggression' and 'good investment' are not necessarily synonymous terms. Male investors tend to be more in favour of making snap decisions and trading more often, focussing on the immediate gain. Much as it was for the ancestral male hunter-gatherer, short term victory takes precedence |
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