Women and Money

Women may face unique challenges with money due to a number of factors. Such factors can make it more difficult for women to achieve their financial goals and obtain financial security. These factors include: 

• Pay gap: Women still earn less than men for doing the same work. According to the U.S. Census Bureau, currently women earn 82 cents for every dollar that men earn.
• Lack of retirement savings: Women are more likely than men to be single and not have a partner’s income to help them save for retirement. They are also more likely to take extended time away from work to care for children or ill or older family members. This can impact their overall savings rate, their retirement savings rate and Social Security contributions.
• Debt: Women are more likely than men to carry debt, particularly student loan debt. Consider this also in light of the pay gap (see above). This can make it difficult for them to save for other financial goals, such as retirement or a home.
• Lack of financial literacy: Women may be less encouraged to gain a basic understanding of financial concepts, such as investing or budgeting. This can make it difficult for them to make sound financial decisions.
• Societal pressures: Women may feel pressure to confirm to societal expectations and may use larger portions of their income on clothing, accessories, dry cleaning, shoes, beauty routines (e.g., hair and nails) and more. 
• Women live longer: According to the World Health Organization (WHO), the life expectancy for women in 2023 is 80.2 years, while the life expectancy for men is 73.3 years. This means that women can expect to live 6.9 years longer than men. This means they need their savings to be larger or last longer.
• Living single, longer: More women are living single longer than men. In 2019, 34% of women ages 18 and older were living without a spouse, up from 28% in 1990. Meanwhile, 29% of men ages 18 and older were living without a spouse, up from 24% in 1990.
• Under-presentation of women in finance professions: According to a 2022 report by the Financial Industry Regulatory Authority (FINRA), women make up 26.8% of the workforce in the U.S. investment industry. This is still significantly lower than the 49.7% of women in the overall workforce. One factor is the lack of female role models in the industry.

These challenges can make it difficult for women to achieve financial security. However, there are a number of things that women can do to overcome these challenges, such as:

• Negotiate their salaries: Women can and should negotiate their salaries and seek out career coaching and/or mentoring to help with such processes. They should also be aware of the pay gap and consider this as they make job and career decisions.
• Start saving early: Women should start saving for retirement as early as possible, even small amounts are helpful. They should also take advantage of tax-advantaged retirement savings plans, such as 401(k)s and IRAs.
• Pay down debt: Women should focus on paying down debt, especially high-interest debt, such as credit card debt. This will free up more money to set aside funds to save and even invest.
• Automate savings: Make savings as consistent and easy as possible by having a set amount taken out of each paycheck for emergency funds and future financial goals, such as buying a home.
• Encourage finance careers: More girls and young women can be encouraged to study finance. More female-friendly workplaces can be created in the industry.
• Get educated: Women should educate themselves about financial concepts, such as budgeting and investing. There are *many* resources available to help women learn about money, such as books, magazines, podcasts, websites, and financial counseling services such as Parachute! Spending at least 1 hour a week learning basic money matters is really helpful!

If you’re dealing with high interest debt payments as well, see what you can save with Parachute’s Debt Management Plan https://parachutecreditcounseling.org/dmp-calculator/

Would you like to meet one-on-one with one of our Financial Counselors to talk specifically about your budget? Check out our Financial Coaching Session https://parachutecreditcounseling.org/services/credit-budget-counseling/#financial-coaching  or call 716-712-2060.