Domestic abuse can become financial abuse
One spouse invariably carries the biggest burden when it comes to managing investments, insurance and banking. One partner might have it easier, watching the household budget, paying the bills or serving as the guard dog for important documents or online accounts.
All that might be fine until one spouse or partner uses joint finances to control the other. That’s when serious problems can arise. Financial abuse, which can be tied in with physical violence, is a tool whereby one person in a relationship tries to subjugate the other through tactics designed to increase isolation and dependence.
A quarter of all women will experience domestic violence over their lifetimes, said Vicky Dinges, a senior vice president at Allstate in suburban Chicago. Women are more likely to be victims than men. Financial-abuse tactics — such as stealing assets, withholding cash for basic needs, obsessive monitoring of the other person’s spending and even prohibiting his or her employment — occur in the vast majority of domestic-violence cases, Dinges said.
The Allstate Foundation supports a program called Purple Purse (purplepurse,com) that aims to raise awareness of financial and other types of abuse, while providing an online curriculum designed to empower victims.
Shannon Evans, a Phoenix woman in her early 40s, said she encountered both domestic violence and financial abuse. She lost her life savings, home and other assets that she brought into a relationship.
Evans, who previously worked in the hospitality industry, said she was inspired to attend and complete law school after leaving the relationship. In retrospect, she wished she would have protected her personal assets and feels it’s important to keep premarital and personal funds separate. Evans suggests both partners maintain control of joint money and have equal access to all shared accounts. Having some credit cards and accounts in each person’s name can help avoid problems if one person starts withholding joint funds from the other.
She also recommends looking out for signs or conduct that can lead to financial abuse. If your partner acts secretively or tends to be angry, be cautious. And she suggests seeking the feedback of impartial friends and family members who might be in a position to observe red flags regarding a partner’s behavior.
“Victims often are withdrawn,” said Dinges. They also worry excessively over how their spouse or partner might react to spending on everyday items. They might not even have access to spending money or credit cards. “Even getting to work can be a problem if the person doesn’t have a car or can’t afford a bus ticket,” she said. “It can snowball into a lot of things.”
Women trail in retirement preparation.
Many women have less money saved up for retirement, and feel less confident about it, than men. But marital status might be the more telling factor here than gender alone.
Higher percentages of both married men and married women say they have personally saved money for retirement (excluding mandatory Social Security deductions) than have single men and women, according to this year’s Retirement Confidence Survey from the Employee Benefit Research Institute. Spouses also are more likely to have Individual Retirement Accounts and workplace 401(k) plans than their single counterparts.
The differences become glaring when people report the amount of retirement savings they have accumulated. At the top end, 26% of married men said they have at least $250,000 in retirement assets, with 28% reporting less than $10,000 and the rest in between those ranges. Married women and unmarried men cluster somewhat lower down the asset scale. But unmarried women lag badly, with a whopping 64% of single women having accumulated less than $10,000 in retirement assets against just 5% above $250,000.
Women ahead in credit management
Women seem to be winning the gender financial battle in one area — paying bills on time and keeping a lid on debt.
So says Experian, the credit-reporting agency, which reported that women have an average credit score of 675 and $26,610 in average debt — defined as that for credit cards, auto loans and personal or student loans. Those figures compare to an average credit score of 670 and debt of $27,627 for men. The analysis is based on Vantage credit scores, for which the range is from 300 to 850.
Women on average have more open credit cards in their name but utilize a smaller proportion of available borrowing capacity. Also, women have lower mortgage amounts and are a bit less likely to be behind on payments.
“Men appear to be taking on a bit more than women, specifically when it comes to the homes and the cars they buy, which could be affecting their credit scores,” said Michele Raneri, vice president of analytics and new-business development at Experian.
Women are more likely to buy functional, utilitarian vehicles, while men gravitate more toward sports cars and trucks, according to the research. In terms of home loans, men on average have mortgage-origination amounts of about $231,100, compared to $212,900 for women.