Yet to Buy Into Abenomics, Wives Cut Husbands’ Pocket Money

August 29, 2013, 3:47 PM

Yet to Buy Into Abenomics, Wives Cut Husbands’ Pocket Money

By Kana Inagaki

Japanese men hoping to reap the benefits of the economic upturn with an increase in their monthly spending cash will be disappointed to find this won’t be happening anytime soon. It seems their wives, who typically control family purse strings in Japan, have yet to buy into Abenomics. According to an online survey of 3,300 individuals carried out by Orix Bank Corp. in July, the average monthly spending allowance of men fell by 11% compared with last year’s survey, falling to Y30,468 ($310).In some ways, the survey result released Tuesday is not a big surprise since Prime Minister Shinzo Abe’s policies to bolster the economy have yet to translate into a rise in wages for the average Japanese worker.

Many economists say it will take longer for the policies – known as Abenomics – to boost the base salaries of company employees and seep into the spending patterns of average Japanese homes. Spending so far has mainly been driven by those profiting from a rise in share prices from late last year, leading to a splurging on luxury items by the wealthy.

While the reasons are unclear, the survey also indicates that most men didn’t even attempt to have their pocket money increased. Only 5.1% of respondents said they negotiated to have their allowances raised. And of those who did bargain with their partners, 70% didn’t actually succeed in getting a raise.

One other reason for the ongoing spending restraint may be that many Japanese wives – known for their frugal spending patterns and detailed bookkeeping – are simply too used to taking a cautious stance on managing household budgets while their husbands are well trained at getting by each month on a tightly controlled allowance. In the annual survey, 59% of married respondents said their wives managed their finances. Changing the deflationary mind-set of these wives, and of Japan at large, is one of Mr. Abe’s longer term challenges.

But even these thrifty households may reluctantly loosen their purse strings ahead of a planned rise in the sales tax to 8% from 5% in April, bringing forward purchases to save money over the long run. According to the survey, the top three items to buy ahead of the tax hike are large home appliances, cars and holiday trips.

Still, an overwhelming 61% of respondents aged in their 60s or older said they don’t plan to buy anything ahead of the tax hike.

So what will it take to get these people to spend more? That’s one hurdle Mr. Abe has yet to clear.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: