Friday, November 16, 2007

Married Men and Women Save More Together

The Fawcett Society, a British women's advocacy organization, has just released a study about how men and women differ in how, and how much, they save money.

The main finding is that women save for others, but find it harder to save for themselves. They save for short-term goals more than long-term objectives. Women are more averse to taking on debt. Men, by contrast, are a little more likely than women to save in general, to save for the long term, and to take on debt. The biggest savers are married men. Unmarried men and all women save at about the same average rate: about $200 per month. Married men, by contrast, save about $300 per month.

Putting these facts together, it seems to me that the crucial variable in the savings rate is whether the men and women in question are married, and especially married parents, or not. We would expect that married moms would save the most for others, married fathers would save the most for the long term. Mothers probably have less income to save from than they did before they had kids, but married mothers can rely on their husbands to save more for the whole family.

The Fawcett Society, though, does not want to treat married parents as a unit for savings. Instead, they argue that it is a great advance to treat men and women as separate, regardless of their family situation. They do not want to factor marriage in to household savings decisions because "households change." They argue, correctly I think, that savings needs to be analyzed over the life course, but then assert that "a lifecourse by definition must focus on the individual." Yet in a deep sense this is wrong. Marriage makes two people one flesh, and they make their savings decisions, short-term and long-term, together and on the assumption that they will be working together. Sometimes, as we all know, this assumption turns out not to be true, but this does not mean that most married people do not make it, nor that they should not make it. The Fawcett Society, in an effort to treat "women" equally, distort the life experience of most women, and most men, who marry and save together.

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