We think we’re the better half when it comes to money – especially women

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, comments on Opinium survey September 2022), showing that we think we’re the better half when it comes to money – especially women.

Key points from survey:

• • We’re twice as likely to say we’re better with money than our partner (39%) than we are to say they’re better than us (19%).
  • Women are slightly more likely to say they’re better with money than their partner (41% compared to 38% of men) – and slightly less likely to say their partner is best (19% compared to 20% of men).
  • Older people are more likely to say they’re better with money than their partner (41% of those aged 35 and over), and those who are retired are particularly likely to agree (44%).

Sarah Coles says:

“We’re twice as likely to think we’re better with money than our partner than we are to think our partner knows best – and women are even more likely to feel this way.

“Money was unlikely to be something you brought up on your first date, so we tend to discover our partner’s financial failings as we go along.

“Fortunately, even if your partner is a financial disaster zone, there are steps you can take to protect both of you.

“Two in five (39%) people say they are better with money than their partner, and only one in five (19%) say their partner is better.

“The good news is that two in five (37%) agree that they’re both roughly equal when it comes to money management.

“Less positively, older people are more likely to say they’re better with cash than their partner. This may be because we’re not asking one another about money in the early days, so it’s only after we’ve been together for a while that our differences emerge.

“The number of people saying they are better with money grows when we get to the age of 35. This may be because more couples have joint goals at this stage – such as bring up a family or buying a house – which has highlighted where one partner is struggling.

“Likewise, retirement tends to throw up more differences, as couples adapt to living on a lower income. At this stage, 44% of people think they’re better with money than their partner, and only 13% think their partner knows best.

“Women are more likely to say they’re better with cash. This could be one reason why our previous research showed that women were more likely to take the helm when it came to looking after household finances like bills.

“This exposes the misconception that men are somehow biologically designed to be better with money as a ridiculous myth. There’s no reason why either men or women should be more suited to the task.

“It can create all sorts of problems when one of you is less money-savvy, especially when it means things like missed bills and debts. Some couples prefer to leave all their financial matters in the hands of the person who is better with cash, but this creates issues of its own.

“The HL Savings & Resilience Barometer in January showed that couples who make their financial plans together do far better than those where one person is in charge – they’re more likely to have money left at the end of the month, and more likely to save.

“There are also risks if one of you loses touch with their finances. All relationships eventually end – either through a split or a bereavement – and this is the worst possible time for anyone to have to get their head around money.

“Instead, there are a few approaches that can help protect your finances, while ensuring neither of you loses track.”

Seven steps to protecting your finances together:

1. Have the money conversation as early as possible. Don’t wait until you’ve already committed. You need to know where you stand well before then. This needs to cover where you both stand right now – including any debts. It should also explore your attitude towards money and your goals. You don’t have to agree about everything, but it can help to know where they’re coming from.

2. Set some financial ground rules. You don’t need to share every aspect of your finances with one another. Our research shows that 15% of people agree to keep some financial things to themselves when they’re in a couple. However, you need to set some rules together about things like debt and bills, and ensure you talk to each other in plenty of time if it looks like you’re going to fall foul of those rules. We all make mistakes, but we need to commit to being honest when we do.

3. Think carefully before moving in together: If your partner’s lack of money skills have led to real problems, it becomes even more of an issue if you want to move in together. At that point you need to know where you stand and then make a decision: can you cope financially if they can’t pay their way, and are you prepared to do so? These are two separate issues, and you shouldn’t feel under pressure to say yes to either of them.

4. Understand the risk before you take out joint financial products: If you have joint financial products, your credit records will be linked. This doesn’t happen automatically when you move in together, but if you have a joint account or any other financial products together, a link will be formed. It means if your partner makes financial mistakes and runs up debts or misses payments, it will affect your ability to borrow.

5. Use direct debits: This can be a great way to ensure that even if your partner is terrible at saving, the money goes out of their account each month without them having to think about it. It’s also a useful way to ensure that all the bills are covered, If there’s a chance your partner won’t have the cash to cover the direct debit by the time the bills arrive, you can set up an account for bills that you both pay into on payday. Just bear in mind that if you run this as a joint account, they can spend the cash on things other than bills, and you’ll have linked your credit reports.

6. Consider joint finances. This can help by ensuring you both have complete clarity over your finances, and can discuss every decision. However, you need to be sure you’re not just creating an opportunity to have more rows – or for one of you to run up debts that you’re both responsible for. Of course, your credit reports will be linked too.

7. Talk about retirement. If you expect to retire together, you need to plan together.  This means having a rough idea of what retirement is going to look like, what it will cost, and what you both need to do to afford it.

Other findings from the survey:

• • Married people are slightly more likely to say they’re both the same (40%) when it comes to money.
  • Basic rate taxpayers are more likely to say they’re best at managing money (44%), and less likely to say their partner is better than them (16%).
  • 41% of those with cash savings say they’re better with money, and 23% of those without savings say their partner is.

Kindly shared by Hargreaves Lansdown

Main article photo courtesy of Pixabay