Tougher economic climate calls for wiser spending for women

Research shows that women make the majority of purchasing decisions in the household. So, while men might stop spending during times of economic sluggishness, women, at the helm of the household budget and spending decisions, have to and will carry on spending.

They can’t afford not to. They must ensure that there’s food on the table, cleaning products in the kitchen cupboard, toiletries on the bathroom shelves and clothes on their children’s backs.

They also need to ensure there’s enough petrol in the car to ferry the kids to school and enough money to pay for their extra mural activities to ensure that a sense of normality reigns.

As such, women still have tremendous influence on the economy – even during tougher economic times.

According to Robyn Farrell, managing director of 1st for Women Insurance Brokers, “interestingly, there have been a number of articles published in the local and international media describing women as recession-proof. One article published on a well-known local women’s online portal even went as far as to suggest that women will pull the local economy through the global economic recession.

“When you consider that in most families it is the woman of the house who holds the purse-strings and decides how the family budget is apportioned, you can understand why.

“In the US for instance, a survey revealed that while 77% of women say they are cutting back on spending, they are still responsible for the majority of retail spending, adding up to $5 trillion a year.

“As long as women continue to spend, they have the potential to keep certain sectors of the economy afloat during the downturn.”

She points out however that the tough economic times require that women make smart decisions about how and where the family budget is spent.

“It is generally accepted that women are better at managing money than men. But, at the same time, women are more prone to emotionally-charged shopping sprees. So, in times of crisis, even financial crisis, they are more likely to hit the shops. Shopping and spending becomes a mechanism for coping with stress. And, let’s face it the global recession is a source of stress for many of us.

“A recent survey in the UK showed that about half of women in that country are frightened by the recession, and 75% said they would be making cutbacks. Yet 79% of them said they would splurge to cheer themselves up.

“This can be dangerous when the order of these difficult times is cautious and wise budgeting and expenditure” cautions Farrell.

She concludes with these tips for staying in control of your spending:

• Create a household budget.
• Plan your spending.
• Keep track of your daily expenditure.
• Make a shopping list before going shopping and only buy what is on the list.
• Don’t shop when you are stressed or down in the dumps.
• Do not carry credit cards and retail account cards in your purse.
• Never buy food or other necessities on credit.
• Think twice about buying clothes and other luxuries on credit – especially if you can’t afford to pay the entire sum back within a month.
• Set aside a certain amount of money for entertainment such as eating out and family excursions – once that money is spent, stay at home.