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Couples and Money: Who Makes the Financial Decisions...and Who Should?

Thirty-nine percent of Affluent households surveyed cited the husband as the primary decision maker, while only 6 percent report that the wife makes the primary financial decisions.

| BY Donald Liebenson

Half (51 percent) make their financial decisions jointly, according to new Spectrem’s Millionaire Corner research. But the other half indicates a gender imbalance that could have serious implications down the road.

Thirty-nine percent of Affluent households surveyed cited the husband as the primary decision maker, while only 6 percent report that the wife makes the primary financial decisions (less than five percent of respondents said that as couples they keep their finances separate and make their own decisions).

What we may have here is a failure to communicate. Ask men who primarily makes the household’s financial decisions and more than half (54 percent) say that they do, vs. 8 percent of women. Fourteen percent of women say they are the deciders of all things financial, vs. just two percent of men.

Of households who report that financial decisions are made jointly, 70 percent of women said they are made this way vs. 41 percent of men.

When examined from the perspective of net worth, the percentage of Affluent households that say the husband is the primary decision maker increases with wealth, from 23 percent in households with a net worth of less than $100,000 to 56 percent in households with a net worth of at least $5 million. The percentage decreases with wealth in households that report financial decisions are made jointly.

Tellingly, Affluent respondents with an aggressive investment risk tolerance are significantly more likely than their more conservative counterparts to say that the husband is the primary decision maker, while conversely, in households that report financial decisions are made jointly, the highest percentage (67 percent) identify their risk tolerance as conservative.

"I encourage both (spouses) to be actively involved in financial decisions,” Ben Leshem, managing director at Hefter, Leshem, Margolis, Capital Management Group of Wells Fargo Advisors, based in Deerfield, IL. “You never know who needs to know what. When I make an appointment with a client, I ask for both to come in together.”

Leshem works with high net worth clients (at least $5 million), and so running out of money isn’t a primary concern for most of them. What is, though, he told Millionaire Corner, is working with them to create a financial plan that will allow them to determine what their capital can generate and create a financial plan tailored for them that will allow them to maintain their lifestyle.”

Changing gender roles make a joint approach to household finances preferable, experts recommend. A Pew Research study conducted last year found that four-in-10 American households with minor children now include a mother who is either the sole or primary breadwinner. This is the highest percentage on record, Pew reported.

It is “quite common,” Leshem said, for financial discussions to be dominated by one person (in the household) who owns a company or is most successful, and women are becoming much more involved in these discussions.”

This is more prevalent with younger clients, he said.

Another reason why women are taking on an increasing role in household financial decisions is longevity. Women generally outlive men, so if their spouse passes, they need to assume the responsibilities of money management and possess knowledge of their household’s finances.

Affluent men and women surveyed by Spectrem’s Millionaire Corner claim to share an awareness of the financial state of the overall estate as well as knowing what to do in the event of the death of a spouse. Ninety-two percent of men and women said their spouse knows the financial state of their estate, while all investors surveyed said they felt confident that they could locate the necessary financial documents in the event of their spouse’s death. 

Almost half (45 percent) of Affluent respondents said that he or she sits down with their spouse to talk about household finances on a monthly basis. Just over one-third (36 percent) do so weekly.

About the Author

Donald Liebenson

Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.  

A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.