“Our research clearly shows a gender gap when it comes to who has the most bargaining power in a relationship in terms of investment decisions, with women often having less influence over household financial matters compared to men,” explained Dr Ran Gu, one of the lead authors of the study published in the journal Review of Financial Studies. “We found this mismatch correlates with other research into household money matters, such as day-to-day spending and large purchases. Husbands often seem to have the upper hand.”
The reasons behind husbands’ control of investment decisions is due to several factors identified by the study including age (husbands were likely to be older), work status and income.
In ‘traditional’ households the study found that men usually made all the investment decisions without even consulting their spouse, but for those households with greater equality it was a very different matter: “it is more likely to be the wife who leads the financial matters, but she will still listen to her husband’s opinion and incorporate his ideas at least 30% of the time,” added Gu.
Personality type also plays a key role with men more likely to be ‘less agreeable’ and ‘less introverted’ with these types of people tending to have more bargaining power in investment decisions.
But men’s greater tendency towards riskier investments may harm women’s financial security.
