#Next20: Women’s Money Matters
How women can be their own advocates to build a strong financial future.
Women often have a complicated relationship with personal finances, exacerbated by a number of societal barriers — wage gaps across gender and race, the wealth gap and the burden they often face as financial gatekeepers for their families. Thinking about investing, saving for retirement and other financial goals often get lost in the shuffle. All of which means women have to work harder, save more and be their own advocates.
According to a 2018 U.S. Bureau of Labor Statistics report, median weekly earnings for full-time salaried women are just 81% of what men earn. On top of that, Black women in the U.S. are paid 21% less than white women.
Statistically, women live longer than men. But the career breaks many women take to care for family can cause them to lose potential raises, collect less from Social Security in retirement and fund less in their retirement plans — all of which perpetuates the wealth gap.
Plus, many women act as the financial gatekeeper in their homes. They have to manage the household budget in the midst of caring for children and relatives while also working. Developing personal finance acumen is often pushed to the wayside.
In the first segment, Yahoo! Finance reporter Alexis Keenan sits down with Bola Sokunbi, best-selling author and CEO/founder of Clever Girl Finance and Erin Lowry, best-selling author of the Broke Millennial book series.
And in the second segment, Alexis welcomes Sallie Krawcheck, CEO and co-founder of Ellevest.
Here’s what they said:
“One thing women have to realize is that it's important for us to start building up financial confidence and we start that by letting go of any shame we're carrying with us about our money mistakes,” said Bola. “It's more important to assess what you have learned from it, take the lessons, push the rest aside and let go of those mistakes and feel more confident about the knowledge you're building and have those conversations with your friends and your family.”
“Missed payments are across the board the fastest way to crash a credit score,” said Erin. “Depending on the type of credit scoring model, about 35% of credit scoring is on-time payments. One of the best things you can do for yourself in times of crisis is honestly protect your credit, because a high credit score does open up a lot of opportunities for you in the future.”
“In this pandemic, we've seen that traditional gender roles are alive and well,” said Sallie. “We’ve watched women disproportionately lose jobs and then have to come back into the home and take care of the children. We've seen women who have had the privilege of working from home with the kids hanging all over them. Men’s productivity during the pandemic has gone up 50%, women’s has plummeted double digits. We have to make sure we aren’t penalizing women for the traditional gender role that they may be playing at home.”
Why it matters:
Women and their relationship with finances doesn’t have to be complicated. Empowering women and giving them the tools to invest in their future ultimately creates a better outcome for all of us. It starts in the workplace where we close gender wage gaps and provide the resources needed for working mothers and caregivers. It’s also about educating women to have the financial confidence and literacy that can transcend generationally and close wealth gaps. When we invest in women, we invest our future.