Do Men and Women Manage Their Finances Differently?

By Lindsay Frankel
Inside Subprime: August 11, 2020

In the second quarter of 2020, women earned just 84 percent of the median weekly earnings that men did. That translates to men earning nearly $14,000 more per year during their peak earning years. The pay gap alone establishes different financial pictures for each gender.  

Women could not apply for their own credit cards until 1974. And a gender financial literacy gap still exists, in part because women in households with two working parents take on more family responsibilities than men, leaving them less time to focus on their financial goals. With men earning more and spending more time focusing on financial growth, here’s how personal finances differ between the genders. 


A 2014 survey found that men ages 35 to 44 are more than twice as likely to get financial help from their parents and more than three times as likely to live with their parents than women the same age. Women living at home are also twice as likely to say it’s because they’re helping their parents, while men living at home are twice as likely to report it’s because they’re unemployed or underemployed. To make matters worse, 20 percent of men don’t plan to provide their parents with any emotional support, while only 12 percent of women said the same. 

Retirement Savings

Women live longer and will need more retirement savings than men, but they haven’t been able to amass as much due to their lower average earnings. Here’s how 401(k) balances differ between genders, according to Vanguard data:

Gender IdentityAverage 401(k) balanceMedian 401(k) balance

However, different studies reveal different results about the savings behavior of the genders. According to Vanguard, when it comes to voluntary workplace retirement plans, women earning less than six figures annually show participation rates that are 11 to 17 percentage points higher than men. But the 2019 Transamerica Retirement Survey found that only 68 percent of women contribute to a workplace retirement account when compared to 81 percent of men, and men start saving one year earlier on average. A separate survey also found that 19 percent of working women don’t have anything stashed away for retirement. 

That’s problematic because many women will need to rely on social security in retirement, which isn’t sufficient to live comfortably. To avoid negative financial outcomes, women should plan to save 10 to 15 percent of their salary per year in a retirement account, including contributions from employers. 


While women are more confident than men in areas like paying bills and budgeting, only 52 percent of women feel confident managing investments when compared to 68 percent of men. And 59 percent of women said they’re not satisfied with their use of investing to reach their financial goals, with 41 percent reporting that not investing more is their number one financial regret. 

A number of studies have also shown that men tend to take on more risk when investing than women. Women are also more likely to leave their investments alone rather than taking a hands-on approach to management, and women’s portfolios tend to perform better during a downturn. 

52 percent of women who invest are interested in or participating in impact investing compared to only 41 percent of male investors. 

Women also view financial success as a way to gain more career flexibility. “Women make more values-based decisions for themselves and their families, rather than just going for the bottom line. When you bring values into the conversation, it makes all the difference,” says Jeanette Schneider, Senior Vice President and Private Client Advisor at U.S. Trust. 

Student Debt

According to the American Association of University Women, women hold about two thirds of the country’s $1.54 trillion in student loan debt. This massive debt load presents a barrier to building wealth for the future. 

Part of the disparity is due to the financial literacy gap: A report from Laurel Road found that not only are men more likely to prioritize income in their career choice, but they’re also more likely to comprehend their financing options when applying to college. Other factors include:

  • Women are less likely to receive financial support from family
  • More women go to college than men
  • Women earn less than men after graduating

Carrying more student debt means women have further to climb with less earnings than men. Ultimately, women should save more money for retirement than men, but it’s easy to see how debt can get in the way. 

Both men and women are struggling. 

The bottom line is that both genders struggle with financial stability, but women face more setbacks than men. Financial literacy scores are not improving, leaving both young men and women unprepared for the future. And the pandemic has had a devastating financial impact on the average American family, with women bearing the brunt of most of the lost income, due to both their family responsibilities and occupations. Both men and women need support with their finances, and it likely won’t be sufficient for spouses to learn from each other. Seek help from experts and utilize free financial resources to get your finances on track. 

For more information on the middle income consumer, subprime loans and payday loans, see our city and state financial guides including states and cities like California, Texas, Illinois and more.