When it comes to money, women really are different from men. What sets them apart is the different situations they will face during their lives, each with financial implications.
For example, women have longer life spans and more checkered work careers than men, moving in and out of the paid labor force more frequently. When they marry, they often face a special kind of financial dependency that is not always unwelcome but can work to their disadvantage and may be discomfiting. They often bear the main responsibility for rearing children, and then take on the added financial burden of caring for aging family members. Finally, after years of having their financial lives intertwined with the lives of others, they face the prospect of years on their own following the death of a spouse and the launching of children.
In my new book, Money Smart Women, I cut to the chase, giving busy women specific financial advice tailored to each stage of life: how to establish financial independence when first starting out, how to maintain that financial independence in marriage, how to survive a divorce and how to invest with confidence to ensure a secure retirement.
Being money-smart is a state of mind in which you're confident of your ability to support yourself financially if necessary, and comfortable with handling money -- or seeking help if you need it.
How the sexes stack up
Because their life situations differ from those of men, women often look at the same financial products from a different perspective. Nowhere is this Mars-versus-Venus divide more apparent than when it comes to investing in the stock market. In fact, over the last decade few areas of personal finance have been dissected as thoroughly, and the results tend to be remarkably consistent: Far more women than men express a lack of confidence in their ability to invest. As a result, many women either don't invest at all or invest too conservatively.
In a recent study by OppenheimerFunds, for instance, more than 60% of the women interviewed said they don't know how a mutual fund works, versus 41% of men. Within a household, women are more likely than men to pay the bills (60%), balance the checkbook (67%), and maintain the family budget (54%). But only 25% of women -- versus 44% of men -- are responsible for buying and selling stocks, bonds and mutual funds.
Another survey by Merrill Lynch found that women don't enjoy investing as much as men and aren't as likely to try to beat the market. When brokerage firm Charles Schwab looked at the portfolios of its clients, it found that women were more likely than men to have money in bank certificates of deposit.
One reason may be that women tend to be "present thinkers," providing for their families' immediate needs and wants, saving for short-term goals and balancing all the elements of day-to-day life -- in short, multitasking.
But personal experience also plays a big part. Women still earn less than men, on average, and work more intermittently. By age 45, full-time working women average 3.2 fewer years of work experience than men, according to the Employment Policy Foundation, so they build up less in retirement savings and seniority.
Women who marry are often financially dependent on their husbands to some degree. That's a risky business when you consider that about 40% of first marriages will end in divorce, and the average age of widowhood among women in first marriages is 58.