Boys beat girls on financial preparationNews added by Benefits Pro on August 19, 2014
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By Marlene Y. Satter

Women typically have a rougher time financially than men. They live longer in retirement; depend more on Social Security (usually at a lower rate than men because of lower salaries and less time in the workplace), and have less income and less chance of it from a 401(k) or defined benefit plan (again, because of generally lower salaries and less time in the workplace). They also are more likely to have raided what retirement savings they do have to deal with financial emergencies.

And now, the coup de grâce: even as girls, they’re running behind on being prepared financially. A new T. Rowe Price survey, “Parents, Kids & Money,” reveals that parents prepare boys better than girls to face the financial realities of life.

In the survey of 8- to 14-year-old kids and their parents, more boys than girls said their parents talked with them about setting financial goals. In addition, the survey data indicate that kids whose parents do have those dreaded financial conversations with them do better at understanding financial issues (66 percent), developing saving behaviors (60 percent), feeling more confident about money issues and even saving for college.

Those early years of financial education with parents can lay the groundwork for retirement savings — where women are handicapped without knowledge about saving, investing and setting financial goals.

Fifty-eight percent of boys said their parents talked with them at least sometimes about setting financial goals, compared with 50 percent of girls. Eighty percent of boys’ parents feel their child understands the value of a dollar, while only 69 percent of those girls’ parents do. As a result of those conversations (or lack thereof), 45 percent of boys say they are extremely smart about money, while only 38 percent of girls feel that way.

More boys also say their parents are saving toward their college education (53 percent of boys, compared with only 42 percent of girls).

Of course, any lack of education on money is a problem waiting to happen. Among the kids whose parents talk to them frequently about saving for college, 58 percent say they, too, are saving on their own for the same goal. Only 28 percent of kids who don’t have those conversations with their parents are doing so.

Educating kids on investing also makes them more likely to save for college; 81 percent of kids whose parents have talked with them a lot about stocks, bonds and other investments are saving for college on their own. Among the kids who don’t often get those conversations, only 25 percent are.

Originally published on BenefitsPro.com
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