Women have had to deal with the “overindulgent spendthrift” stereotype for ages, and it has led mostly advisors to accept what financial journalist Helaine Olen calls the “Sex and the City approach to female finance.”
The underlying message? Those silly girls run into financial trouble because they buy Jimmy Choo shoes when they should be giving money to Chuck Schwab instead.
But the idea that women spend their money irresponsibly is a myth.
Where the “Shopaholic” Myth Comes From
Why do women have such a notorious reputation for being shopaholics? It’s likely because women do tend to shop more than men — in fact, they’re responsible for 85 percent of overall consumer spending.
But consider the context: Women are almost always the primary caregivers for their loved ones. That means they end up not just buying for themselves but for their kids, spouses, relatives, friends, colleagues, neighbors, mailman, babysitter… you get the picture.
“If somebody, somewhere needs a gift, chances are there’s a woman thinking about it — tracking it down, wrapping it, making sure it’s accompanied by a personal message, and then delivered on the appointed day,” says Bridget Brennan, a leading researcher on female consumers. “I sometimes think entire industries would collapse overnight if women stopped being so thoughtful. Consider the impact to the greeting card industry alone.”
Looking at the Numbers
When women do shop for themselves, they spend more on categories you’d expect, specifically clothing and personal care. Men, on the other hand, splurge more on alcohol, electronics, and car purchases.
In fact, men spend more overall:
- A 2011 Gallup poll found that on average, men spend $11 more per day than women.
- Men are also less likely to comparison shop and quicker to click the “check out” button while online shopping.
- They also spend significantly more on impulse purchases.
- In 2013, Experian noted that men had 4.3 percent more debt than women, took out bigger mortgages, and were late on their payments more often.
Yet somehow, men don’t seem to encounter much criticism about their spending habits — no smirks, no snide comments, no finger-wagging, no latte-shaming.
Own Your Financial Power
It’s time we changed the narrative. Don’t be afraid to share the data and your own experience with others. And if you want to learn more about dispelling common money myths, download our free eBook Rewriting the Rules: Telling Truths About Women and Money.
If you’re interested in learning more about impact investing, reach out to our team today.