Why women save more than men

Friday, January 8th, 2021 00:00 |

Njeri Maina @njerimainar

It is that time to plan for a new year (if you haven’t yet) and correct mistakes of past years.

But in order to form new habits, it is important to notice personal financial habits and trends and then try and correct them.

One of the most interesting money trends is how men and women differ in how they spend and invest money.

A recent research shows that women save more than men, with many more women investing in land compared to women. But is this true and if so why?

“Our research at Centonomy, from over 11 years of training Kenyans in personal financial management, shows that women tend to save more compared to men.

They also take less risks in their investments. Men on the other hand are less likely to save and often take more risk in their investments.

This means that more women will invest in land as it is a sure bet while men are more likely to take their chances with the stock markets,” Waithaka Gatumia, Centonomy founder and CEO explains.

He, however, explains that as much as the genders might differ in spending and saving habits, they are largely similar in motivations.

Everyone’s concern regardless of the money they make and their gender is to ensure their primary needs are catered for.

This means that how money is spent on needs is uniform across the genders, but differs once the needs are satisfied and the persons start looking to satisfy their wants or desires. 

Lifestyle needs differ from person to person while the need for food, shelter and education remains uniform.

According to Abraham Maslow, the desire to belong to social groups and for esteem normally determine what one spends their money after the basic needs. 

Tradition and culture

Due to tradition and culture more men have access to capital than women. In African societies, women could not own land or livestock.

This means that they had nothing to sell for money and had to rely on what little money they got from men as their sole source of income.

The case was the same in most European countries, where women could not own property or work.

They only started working in the late 18th century and early 19th century when men went to war and the women were forced to be the breadwinners.

Even then, wages earned by women were always less than that of men even when the job and working hours were the same.

This inequality has persisted and exists to date ensuring that women have less to begin with compared to men.

Moreover, women do not get paid for any work they do while at home or for emotional labour.

This scarcity of money and lack of access to it is part of the reason why women tend to save more and take less risks when investing.

When you have little money you are less likely to take risks and more likely to save every little coin you get.

“Women are staying single longer and are more and more career-focused now than previous generations, and we want to be smart with our money and make an investment that sets ourselves up for the future, rather than relying on marriage or waiting for a man to provide the life we want,” says Janet Maina a businesswoman.

Way forward

The great thing about financial habits is that they are not set on stone and can, therefore, be changed through conscious decision making.

“Set clear goals and work towards them. We see many clients at Centonomy who come and say that they would like to live in their own home.

This is admirable, but insufficient because a goal has a time and a cost. The goal needs to be really specific.

Where is the house and how much does it cost? When would you like to buy it? That way, you can plan and invest with a target in mind.

If you haven’t worked out what exactly it is you want, then you cannot plan. The plan gives you purpose and direction,” Waithaka advises.

Psychologist Elmard Rigan concurs with this. “Our habits including those concerned with money are controlled by both our conscious and subconscious.

This means that early conditioning can greatly influence our habits with money, with most people who grew up with little tending to be natural savers due to the trauma caused by lack while growing up.

But this is not set in stone as there are big spenders and big savers in the same family.

This difference can be attributed to differences in resilience which speaks to the fact that financial habits just like any habit can be changed.

One should see an expert, be it a financial expert, life coach or counselling psychologist to work out their triggers and emotions that money evoke.

It is only through self-awareness that one can be able to change their saving, spending and investing habits for the better,” he concludes. 

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