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Why women need to know more about money

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Cub Foods shopper
Shopper Lindsay Peterson at Cub Foods in St. Paul, Minn., on January 20, 2011.
MPR Photo/Nikki Tundel

Financial guru and Daily Circuit favorite Ruth Hayden joined us to talk about women and money. She and host Kerri Miller talked about a new survey that says women feel more responsible for their financial health but lack confidence in financial matters.

A few highlights from the conversation:

Hayden on developing the confidence to take risks:
"The studies say that men exaggerate what they know. They say they know more than they do. They pretend they're really good at investing but they really don't know what they're doing. And women diminish what they know. Which means we can't trust the resume of either one of them, by the way. 

"Women always go, 'I don't know that, too.' And they're not willing to just say, 'I'll learn it as I go. It's OK. Life is about learning.' ... One of the things I teach my clients is that there are very few right and wrong answers.

"In my office, I show them how to do risk assessment. If I put my money in here, what's the upside? And what could be the potential downside? The way you make a decision is you manage the downside. 'Can I live with that? Can I manage that? If I can, let's go for it.' There is always some kind of a negative in every decision. And if women are waiting until they have all the negatives managed and they're absolutely sure — it's not going to happen."

On why women need to know how to handle money:
"We all have a learning curve. It's just that women have less money put away than men. We earn less than men. We live longer. We are way behind on the learning curve. ... 

"A good 80 percent of women are going to be single when they die. That's a lot of women. I saw a statistic that said there are more single and divorced women right now than there are married. ... 

"Women need to decide that they are going to be financially competent whether they are in a relationship or not. That we're going to be financially independent whether we are in a relationship or not. If we're in a relationship, our financial security will even get greater, but it doesn't create it. We are financially secure, in or out of a relationship. And that's a paradigm shift."

LEARN MORE ABOUT WOMEN AND FINANCIAL LITERACY

•  America's women face unique financial literacy needs
For years, those of us who toil in the field of improving financial literacy in the U.S. have assumed that women face economic hurdles that men never see. Now we have the data to prove it. Most troubling, American women are far less likely than men to create and stick to a budget — with 47% of women reporting they ignore their budgets or worse — don't even have one in the first place. (Jason Alderman, Fox News)

• Women and Money: Even College Grads Flunk Personal Finance
One of the chief conclusions that financial literacy experts have drawn in recent years is that college graduates — whether or not they took a personal finance course — typically know enough to manage their money reasonably well. It's the other three-quarters of the population that gets into financial trouble. Now, a new study looking specifically at educated women throws that conclusion into question. The mean financial literacy test score for women with at least a bachelor's degree is just 47%, according to Mahnaz Mahdavi, director of the Center for Women and Financial Independence at Smith College. (Dan Kadlec, Time)