Women And Money. Different From Men And Money.

By Erica and Karen

Women control more and more wealth, and because of that, the world will change.

A recent article in The Economist makes three key points:

• Some $68 trn in wealth is expected to change hands in America alone by 2042[.] A lot of it will flow first to widows[.]

• In a report last year, McKinsey, a consultancy, reckoned that much of Boomers’ wealth would be managed by women by 2030.

• Once they are calling the shots, [women] want personal service.

What does it mean? It means you are at the center of an historic shift—the shift of money and the power that goes with it, from the hands of men, exclusively, to the hands of women, too. As McKinsey puts it: After years of playing second fiddle to men, women are poised to take center stage.

Markets of all kinds will follow the money, to you. It’s a fine time to think about money. Especially as we women are the beneficiaries of public health advances that allow us to live a long time—maybe until until we reach the centenary mark. We want to be productive and purposeful during all of those years, and that takes financial planning—no matter when you start.

How you approach money may depend upon any of a number of factors. Allianz did a fairly recent study of personality types in the personal finance world. Among its conclusions: women who have had to learn how to take care of themselves tend to be confident about managing their money, whatever they have. Others remain comfortable with the traditional approach—letting their husbands handle the money. We suppose that some are actually interested in financial markets and investment strategies. Some, of course, are not, possibly because money has been presented in exclusively quantitative terms. And some women may have lost interest after advisors directed their remarks solely to their husbands.

We think women need to pay attention to their finances—especially because we will live a long time and we need to plan for the future. The two of us happen to be pretty interested in the financial markets, but not really from a personal point of view—we just find market watching to be engaging. But we are not especially excited about looking at bank statements, and we don’t think most women are excited about amassing wealth for its own sake. For us, the power of money is in what money can do for us—and our families, and others—now. Differently put, we think women are more likely to spend to make lives better, today, while men are more likely to invest for the future. Both are valuable objectives, but they sure are different.

These differences play out in philanthropy, too. Women give more than men. Women like the collaborative element of giving circles. Women give to high impact recipients while men are more likely to seek high visibility targets. Compare the giving of Mackenzie Scott to that of her ex-husband Jeff Bezos. She understands that her wealth is a result of societal imbalance, and she seems to want to correct that imbalance as fast as possible, giving billions to many high-impact organizations in categories and communities that have been historically underfunded and overlooked. Her ex has promised billions too—but apparently mostly over time.

Of course, women do have to invest in themselves, too. Women will live a long time, and during that time we need money to survive, and for our families to survive, but presumably we would like to do more than that. Some of us want to live in homes we love. Some of us want to travel. Some want to buy cars or art or the latest dress. Some of us like jewelry. If decades of work has left us with discretionary income, why not?

The point is—if you want to deploy your money in specific ways, you should do so—as long as you are clear what you need to live on. Presumably, the economic shift described in The Economist means financial advisors will turn to us with greater interest, and greater understanding, and the growing number of women in the field will change how these advisors think about women’s wealth.

So don’t let your brain freeze when talking about money, and don’t let your financial professional talk about something you find irrelevant. Find someone—a woman or a man—to whom you can relate, and push for the answers you need—for your family, and for you.

You have the power, now, to get what you want.