The Barbie movie is the summer's biggest blockbuster, outselling the usual, mostly male-skewing summer box office hits. Expected to pick up the success baton is none other than Taylor Swift, following a summer of sold-out shows with a theatrical release of the Eras tour.
Female artists such as Beyonce, Taylor Swift, and Adele enjoyed unprecedented success with ticket sales, and the past few months have been dubbed the “Summer of Women.”
A recent Morning Consult study suggests discretionary spending by women is boosting the overall economy.
However, this same study also reveals that 52% of the participants thought about their personal financial health “a lot” every month. While discretionary spending among women may have risen in recent months, only 27% reported having excess funds at the end of the month.
One surprising result of the study was that a number of the participants either underreported or downplayed their actual financial circumstances. Even when conditions improved, they still reported feeling anxious about meeting their monthly financial obligations.
Remnants of the Gender Pay Gap?
Study participants from the baby boomer generation reported the highest level of financial well-being, with 52.96% describing themselves as financially stable. Many of these women began their careers at a time when the pay gap between men and women was more substantial.
Gen X women actually scored the lowest in terms of financial well-being. 44.46% reported feeling fiscally secure enough to meet their obligations. The trend is actually on a slow rise, with 45.87% of millennial women and 46.36% of Gen Z women claiming financial security.
Myra Alport, founder of Myra Alport Money Coach, says, “When it comes to financial decision-making, women are often on shaky ground because their emotions strongly guide them. It's one thing to spend more on eating out, entertainment, and personal care, which, thanks to inflation, are higher than ever before because these are mostly absorbable expenditures. A high ticket purchase, especially an impulsive one, can throw everything out of whack and may lead to self-doubt, second-guessing, and anxiety, all of which are unhealthy.”
“Despite all of the strides that women have achieved, financial confidence is still out of reach for many. That's why I thoroughly enjoy empowering women about their personal finances.”
The Financial Cost of Anxiety
40% of the study's participants “completely” or “very likely” agreed that the statement “Because of my money situation, I feel like I will never have the things I want in life,” applied to them personally. The reluctance or perceived inability to make large discretionary purchases is rooted in this feeling of financial anxiety.
Although gift-giving is often seen as a sign of financial well-being, a third of the study participants claimed that purchasing a gift would “always” or “often” create a financial hardship.
Other concerns surfaced in the study, such as 16% reported bank overdrafts, and 13% considered acquiring a new credit card for large purchases.
Financial anxiety also leads to a shift from goods to services or experiences. For instance, an expensive ticket to a favorite performer's concert can feel easier to justify financially than a new home furnishing or fashion accessory. An experience or service also benefits the purchaser emotionally by reducing stress or providing entertainment.
Most Common Financial Anxiety Triggers
According to a recent poll conducted by Bankrate, female respondents reported more negative emotional responses to several standard banking or financing activities. Nearly three-quarters of the women claimed a higher level of anxiety at the prospect of an unplanned expense, compared to 64% of men.
56% of female participants report feeling emotional on billing due dates, compared to 47% of men. Looking at a bank account statement was an emotional trigger for 52% of women, but only 46% of men reported similar anxieties.
However, the difference between male and female respondents became less noticeable in discussions about money, making purchases, or pay dates.
The Great Caregiver Dilemma
Another significant societal difference between men and women is the financial toll associated with caregiving. A survey conducted by AARP determined that 61% of women anticipate becoming caregivers, compared to 39% of men. This additional financial burden also extended to the cost of raising children, paired with a pay gap for mothers working outside of the home.
According to the Bankrate study, 57% of single mothers reported their financial situation harmed their mental state, compared to 49% of single women without children.
Angela Dorsey, founder and financial planner at Dorsey Wealth Management, observes, “Although women may spend more on discretionary spending, there are good reasons why they tend to be more concerned about their overall financial health than men.
In general, women are more security-conscious than men. Women need to feel that they will be okay and not run out of money. Women's retirement portfolios must provide for greater needs and last longer than men's.”
“Women have financial challenges that men simply do not. In general, women are more likely to live longer than men and have higher healthcare and long-term costs. Women are also more likely to care for others and invest more conservatively than men. This depletes time and future growth potential from their long-term financial health.”
Age and Household Income Make a Difference
The Morning Consult survey broke down results along generational and household income lines, revealing that older women with household incomes exceeding $100,000 had the highest financial well-being scores, at least 10 points higher than almost any other demographic.
The one exception to the rule was Gen Z women. While baby boomers have the advantage of additional years to accumulate wealth, many Gen Z women have the financial advantage of living with their parents, decreasing their outgoing expenses, and increasing their discretionary income.
This level of disposable income has largely fueled the 2023 “Summer of Woman” phenomenon.
While women from previous generations may have found ticket prices to a Taylor Swift or Beyonce concert unjustifiably expensive, younger women with more discretionary income see it as an opportunity to have a once-in-a-lifetime experience.
They believe short-term concerns about personal finances will be addressed sometime soon. Therefore, regrets of not seizing the opportunity are given more weight than the immediate financial sacrifice.