Battle of the Sexes: Does Gender Determine Your Financial Future?

Logan Ladnyk • June 26, 2015

From physical to psychological, men and women have a multitude of differences. But does one of those differences lie in how financial decisions are made?

In a word: Yes.

In a (slightly) longer explanation: Yes, but not by much.

Grab a hard hat and strap yourself in because we’re about to do some serious number crunching.

On the Surface, Differences are Minuscule

A 2013 Experian study found women are juuuuust better overall at managing their money and debt. The difference between each gender’s average credit score was a single point — 675 for women, 674 for men. Men have 4.3 percent more debt than women and a credit utilization amount that’s 2 percent higher. Mortgage loans for men are 4.9 percent higher than women’s, and men are 7 percent more likely to make a late mortgage payment.

The average credit score between a woman and man is only a one-point difference.

The study also examined the wage gap between women and men. When working full-time, women earned 23 percent less than men. That wage gap might be why women were better with finances. With less money to spend, women must be better managers of it.

Men and Women Have Different Payment Habits

In 2014, a CreditDonkey survey found 35.5 percent of women pay off a credit card’s balance in full each month, compared to just 31.3 percent of men. Men are also more likely to use a credit card both on a daily basis or at all. Men use a card every day 9 percent of the time and 24.3 percent use one multiple times throughout the week; just 4.2 percent of women use one daily and 20.6 percent use their card a few times each week. Expanding upon that, 32.3 percent of women don’t use a credit card on a regular basis, compared to 28.3 percent of men who have the same habit.

Men are more likely to use a credit card on a regular basis, but they’re also more likely to pay over the minimum balance.

It appears at first glance that women are much better at handling their money than men are, but the survey didn’t end there. Women are also more likely to pay just the minimum amount on their credit card balance, which results in more debt as interest accrues. That split is 15.2 percent of women to 13.4 percent of men. Additionally, the survey found women were more likely to report financial issues or have to choose between which bills they pay and which they delay payments toward.

Our next data cluster comes from a small sample size, with 1,004 people responding to a 2014 BMO Harris survey. Of male respondents, 39 percent paid their monthly credit card balance in full compared to 27 percent of women who did the same. While that contrasts the CreditDonkey survey, the BMO Harris concurred that women have a harder time paying bills on time. Both genders had a majority report they paid bills when due, but 74 percent of men said they did compared to just 59 percent of women.

How Surveys Can Be Misleading

A note, though, in regards to surveys and self-report studies: They rely on respondents to be truthful.

The statistics might say women pay bills on time at a worse rate than men, but that could be because men are more hesitant to reveal their shortcomings — there’s a reason the cliche about men asking for directions is a cliche, after all. A study by Duke University’s Fuqua School of Business found men who asked for help were judged as incompetent, compared to no judgment at all when a woman did the same. If men are conditioned to conceal their problems, they might not be forthright in survey responses.

One explanation for why women and men pay bills differently could simply be that women give more truthful responses.

But the shortcomings any individual survey might have don’t immediately discredit the piece. When examined as a whole, surveys and studies provide a fascinating snapshot of gender’s impact on finances. While men are more likely to spend and be given the means to do so, women are more likely to engage in saving habits but admit when those habits aren’t working.

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Editorial Note: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

About the Author

Logan Ladnyk

Using financial plans, Logan graduated from the University of Florida with under $6,500 in student loans. He then joined CardRates as an editorial assistant. He has written for newspapers and websites from Florida to Australia.