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19 March 2024

Why boys have an unfair advantage when it comes to financial future

Published
By Staff

If you always suspected that boys in general are better prepared to deal with money matters, you may be right. New research reveals that this is indeed the case, but not because they are better handlers of money. Rather, the reason is that parents in general tend to discuss money matters more with their sons than daughters, leading to this disparity.

Findings from T. Rowe Price’s ‘2014 Parents, Kids & Money Survey’ reveals that boys and girls are not equally prepared when it comes to learning about money matters at home.

According to the survey, boys report having more money conversations with their parents, with 58 per cent of boys saying their parents talk about setting financial goals at least occasionally compared with just 50 per cent of girls.

The occasional money talk therefore lends confidence to the offspring, and so it is no surprise more boys say they are smart about money. Almost half (45 per cent) of boys say they are very or extremely smart about money, while only 38 per cent of girls say the same.

Parents’ misplaced belief that boys understand money better than girls is largely to be blamed for the disparity. Of the parents with one child, 80 per cent of parents with a boy think their child understands the value of a dollar compared with only 69 per cent of parents with a girl, the survey shows.

“Boys and girls should have the same opportunities to learn about money matters at home so they can grow into financially savvy adults,” says Judith Ward, CFP, senior financial planner at T. Rowe Price and mother of two.

“If you want to invest in your kids’ futures, start by talking to them about money matters weekly. The correlation between the frequency of conversations about money and kids’ smart financial decision-making is undeniable,” she maintains.

According to the survey, more parents are giving their boy child access to their financial resources (like credit cards) compared to girls. Survey results showed that twice as many boys have credit cards (12 per cent versus 6 per cent of girls).

Moreover, financial literacy from an early age also results in more boys saying that their parents are saving for their education (53 per cent versus only 42 per cent of girls).

“Data from the US Census Bureau show that more women are enrolled in college than men. However, fewer girls say their parents are saving for their college education. By talking to both girls and boys about planning for education expenses, parents can help kids get involved in college savings and excited about their future,” says Ward.

Additionally, the survey of 8- to 14-year-old kids and their parents found a correlation between talking to kids of either gender about financial concepts and kids developing positive financial behaviours, such as identifying themselves as a saver rather than a spender, feeling more confident about money, and saving for their own college education.