Women and men do come from the same planet, but they seem as different as Mars and Venus when it comes to their attitudes towards tax hikes and most other financial matters.
Women worry significantly more about the prospect of increased taxes in 2012, yet men are much more likely to take action to protect themselves from tax hikes, according to the results of a December survey by Millionaire Corner. The differing attitudes and approaches to taxes form part of a larger pattern in which women express heightened concern about virtually every aspect of personal financial management, but are less likely to act. On the other hand, men appear to be much less worried about money matters, yet are more prone to take steps to address their concerns.
The Mars/Venus divide shows up consistently in our monthly surveys gauging investor sentiment on such issues as retirement planning, spending, saving, the financial well being of children and grandchildren, and stock market volatility, in addition to taxation. According to our most recent poll, about 57 percent of women investors expect taxes to increase significantly this year, a concern shared by about 48 percent of men.
Though tax hikes pose a greater worry for women, men appear much more likely to take action to protect themselves from increased taxes. More than 41 percent of women said they were “taking no steps” to protect themselves from increased tax hikes, an approach taken by 28 percent of their male counterparts. Men are nearly twice as likely as women to invest in municipal bonds in the next 12 months, 16 percent versus 9 percent, respectively. About 24 percent of men – compared to13 percent of women - say they are likely to invest in tax-free bonds in general. One-third of men plan to increase their contributions to tax-sheltered retirement plans, such as an employer-sponsored 401(k) plan, but only one-fourth of women plan to employ this strategy to mitigate tax hikes.
Similar trends emerged in our November survey, which asked investors how they felt about recent stock market volatility and how the wild market swings had affected their investment choices. Again, men expressed lower levels of concern over market volatility, but were much more likely to have reallocated assets in response to volatile conditions. More than 45 percent of men investors said they had adjusted their financial portfolio due to volatility, compared to 39 percent of the women. Nearly 27 percent of the men said they had adopted a more short-term investment strategy and were moving away from a “buy-and-hold” strategy, compared to 21 percent of women who reported investing more for the short term.
The Mars/Venus divide in personal financial management also extends to socially responsible and environmentally responsible investing, and charitable giving. Women investors consistently express more interest green and progressive investment products and in philanthropy than men do. In fact, the only strategy to protect against tax hikes favored by women investors is increased charitable giving.