The UK financial planning sector has been trying to get women to engage in finances for a few years and it could finally be starting to pay off.
A recent report from digital wealth manager Netwealth found nearly a third of UK women (29%), who are currently in or have been in a relationship, do not share any financial assets with their partner.
Younger women are displaying the highest levels of financial autonomy, with those aged 16-34 the least likely age group to share their personal financial assets (31%) with their respective partners, compared to 26% of those aged 55+.
Shifting times
Tanya O’Carroll, managing director of Isle of Man-based private client firm Oak, told International Adviser: “There is definitely a shift away from joint finances. Women are seeking financial independence due, in part, to changing demographics, improved education and increasing numbers of women in the workforce.
“Female clients see financial independence as the best way to safeguard their future and that of their family.
“They are also making their own financial investment decisions which may not align with those of their partner’s higher or lower risk tolerance, meaning separate finances are easier to manage.
“High profile divorces and families in financial difficulties are also influencing the trend for moving away from pooled finances.”
Need for control and security
Netwealth’s report also found almost half (45%) of women holding wealth separately from their partners are doing so to maintain financial independence.
Two fifths (40%) of women prefer to manage their money as they wish, while only 15% of women do not believe their partner is entitled to their assets.
Some 23% said it was to provide a safety net in the event of a divorce, as 25% of UK women aged 16-34 said they keep their assets separate for security, compared to just 15% of women aged 55+.
Nero Patel, wealth planning director at Canaccord Genuity Wealth Management, told IA: “It is becoming a bigger and bigger trend for spouses and partners to keep their finances separate.
“I recently met a client in his early 40s who wouldn’t disclose his wife’s income or assets, as she is successful in her own right and they prefer to keep their finances separate.
“In the overall scheme of things, they look at their joint finances when it comes to helping children or repaying debts but until such an event occurs, they save their own income, have separate advisers and plan for their individual spending needs in retirement.”
Wealthier independence
As women’s earnings increase, so too does the likelihood of them keeping assets such as their monthly income, and savings separate from their partner.
Almost one in three women earning £45,000 or more do not share their long-term savings with their partner (29%) in comparison to just 18% of those earning £45,000 or less.
Kirsty Simpson, financial planner at Brewin Dolphin, said to IA: “Whether you keep your finances entirely separate or whether you have everything through one joint account depends on the relationship and the key is to communicate.
“It is always sensible to have access to your own pot of emergency cash, and to keep a degree of financial independence in case of unexpected life events or changes.
“There are also other options where you could decide to combine finances on marriage, and put an agreement in place to protect your existing pre-marriage assets.”
Netwealth undertook two surveys for the report. The first reached 2,007 respondents aged 16+ in the UK and the second reached 1,869 respondents aged 16+ in the UK, who are or have been in a previous relationship.
