Adam and Eve had very different approaches to risk and reward.

But a fundamental difference in how men and women operate was not confined to the Garden of Eden, with many modern day Adams and Eves still taking a very different view of many things, not least money.

Recent figures from Standard Life showed a difference in the level of financial confidence of men and women.

The financial confidence index found that men displayed a greater level of confidence than women, with men’s confidence ranked at almost 55 out of 100, compared with 52 for women.

Financial confidence was not the only money-related area where men and women differ, as many other surveys showed a divergence in how we save, invest and spend.

So what makes men and women operate differently? Is it psychology or culture? And how do these differences manifest themselves in our financial lives?

‘‘In my experience, women are much more attentive to their finances.

Women know exactly what is coming in and going out on a monthly basis,” said Financial adviser Liam Croke.

The mention of the word ‘shopping’ in the context of gender brings a host of clichés to mind – women in the aisles of their favourite shops, draped with bags, while their other halves hover uncomfortably outside, glancing at their watch and shuffling their feet.

Stereotypes typically have a nugget of truth When it comes to shopping, men and women take a different view. For many women, shopping is a pastime, a leisurely way to spend a Saturday afternoon with friends. For many men, it’s a purely functional exercise – buy what’s required and leave.

‘‘Typically, women are more enticed to spend in a consumer environment,” Croke said, adding that many marketing campaigns were aimed at women. From his dealings with clients, he has found that men tend not to make as many impulse purchases as women.

‘‘Guys are generally better at sticking to a budget, whereas women are more likely to use the credit card,” he said.

Also when it came to domestic purchases, such as durable white goods, home insurance or groceries, women tended to shop around more and ask the necessary questions to find the best deal, according to Croke. ‘‘Most men tend to leave this sort of stuff up to their partner,” he said.

While day-to-day differences in approach to cash are more anecdotal, much academic research has been done on how men and women treat investment risk and investment decisions.

Most commentators said women tended to be more cautious, but the consensus was that circumstances were a bigger factor than psychology.

‘‘Women tend to be a little better at doing their research before investing.

But it’s hard to generalise as age, previous investment history and the level of disposable income all come into play too,” Croke said.

Liam Delaney, a behavioural economist in University College Dublin’s Geary Institute, said: ‘‘Men tend to take more risks and be more prone to herding in investments.”

Different investment approaches extend beyond the purely personal sphere. ‘‘Over-exuberance contributes to volatility in the stock market,” Delaney said.

Research has suggested that, if trading rooms – a typically male dominated professional environment – had more of a gender balance, stock markets worldwide might exhibit a more even pattern, with women adding a lower risk strategy to the mix.

‘‘Men are more comfortable with ambiguity,” Delaney said.

He added that men tended to respond well to competitive incentives when investing. For example, he said women would tend to opt for the safe bet if given an option. ‘‘If you offer people €100 now or a 5050 chance of winning €200 or getting nothing, women would tend to take the €100,while men would take the gamble,” Delaney said. Financial adviser Rhona Blake, deputy president of the Irish Brokers’ Association and director of brokerage firm BasePlan, said:

‘‘Women are much more comfortable with low returns and erring on the side of caution. They are not really as prepared as men to accept volatility.”

Blake said women’s more cautious approach came from their historical role in a family setting.

‘‘Traditionally, women have minded the family finances, so they are more conscious of the impact when making financial decisions,” she said.

In Blake’s view, the role of women in society is a significant factor in the differences between men and women financially, with women who work in the home and those working outside it making different financial choices.

Women typically end up worse off from a pension point of view, according to Joyce Brennan, a senior consultant with Mercer. She said that women tended to take time out from the workforce to have children, leading to financial vulnerability.

A career break or part-time work can have long-term implications for the value of your pension pot. ‘‘One way women could make up for it would be to work extra years at the end of their career to make up for the lost years,” she said.

The role women play in society compared to that of men has certainly shaped financial attitudes.

‘‘It’s not that our fundamental psychology has changed. It’s society that’s changed,” Delaney said.

Audrey Byrne, a family law partner with solicitors McCann FitzGerald, said that the way men and women approached money had changed as women gained greater financial independence.

‘‘Women were completely financially dependent, and they were quite financially vulnerable until the 1970s,’’Byrne said.

A series of social reforms from the late 1960s onwards gave dependent spouses – at that stage, typically women – more rights and a greater sense of financial freedom.

Byrne cited the 1965 Succession Act and the 1976 Family Home Protection Act as two ground-breaking pieces of legislation.

She explained that the 1965 act made it impossible to disinherit a spouse, by enshrining specific rights to a spouse’s estate in legislation.

The 1976 act added another level of financial protection for homemakers, giving them certain rights in relation to the family home even if their name was not on the deeds.

Further changes in the late 1980s gave the courts the power to make property orders in separation cases.

Then, in the mid-1990s, Ireland introduced divorce.

‘‘Legislation has really broadened the scope of what the courts could do for separating couples, especially the dependent spouse,” Byrne said.

One thrust of the social reform has been to ensure that work inside the home – typically a woman’s role – is viewed as equally important as work outside the home.

But after all the strides towards financial independence, Byrne said recession had turned the tables for couples. Diminishing asset values, failed investments and negative equity are all factors that make it harder for couples to go their separate ways, while maintaining a level of financial independence.

‘‘People are in some ways more tied together than ever now. A clean break is not as possible,” Byrne said.
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