Why do So Many Women Feel Financially Insecure?

Why Do Women have a Higher Financial Insecurity than men?

Women have a much higher financial insecurity risk than men, due to a lack of financial literacy. Women tend to be considerably less knowledgeable about personal finance than men, according to The US Bureau Labor Statistics states.

This gender gap transcends borders, is seen across the globe, and persists regardless of age, education level, and marital status.

A Stanford Study noted that Women, on average, are expected to live 5 years longer than men, but accumulate over $100,000 LESS wealth.

Why does Financial Literacy matter?

Financial Literacy matters because it it the single biggest determinant of a woman’s financial wealth, which goes hand in hand with life satisfaction.  

So if you want to be happy, be financial literate.

But haven’t we made progress?

– Yes, it’s true, “We’ve come a long way, baby!”

So much so that we no longer define women empowerment by an image of a well-dressed lady holding a skinny cigarette. Thank God! (you need to be a child of the late 60s to understand this reference).

So how DO we define women empowerment today?? 

However, women are still at a HUGE disadvantage.

There are a number of roadblocks on a woman’s journey to financial security.

• the persistency of the gender pay gap, equating to a women having to work 15 months to earn what a man earns in a year
• time out from the workforce for parenting and caregiving
• women are more likely to shoulder the financial burden of single parenthood
• statistically, women live longer than men, which requires more saving for retirement

Women may earn nearly 84% of what men earn according to the US Dept of Labor (this number is lower for women of color), but they own only 36% as much wealth.

This means simply addressing the gender pay gap is not enough. Wealth is much more important than income, as it is what determines your overall well-being.

Men have an have an advantage when it comes to translating income into wealth because personal finance knowledge tends to be lower among women than among men.

How do we improve women’s financial literacy?

First, we need to improve women’s financial literacy. For you, and for your children, as Mom’s make the idea role model for teaching their kids good financial habits.

Start by learning the basics of personal finance such as goal setting, budgeting, managing debt, building savings and starting investing. Once you have a handle on these, dig deeper into each and determine if there are roadblocks keeping you from getting on your way to financial freedom.

Is Improving financial Literacy for Women enough?

Simply focusing on education to improve financial literacy is NOT enough.

The Stanford Study concluded that CONFIDENCE and involvement in making major financial decisions are also important contributors to the gender gap in financial literacy.

Women seems to be more involved and confident in routine decisions.

No surprise, single women who were more involved in MAJOR financial decisions such as tax prep, car and home purchases, were more confident and financially literate.

Financial literacy is an area where women possess less confidence than their male counterparts. In a March 2021 study by the Global Financial Literacy Excellence Center, women were found to answer a financial literacy question disproportionately with “do not know,” yet when that answer option was removed, they often chose the correct answer!

How do we Find Ways to Women’s Confidence?

Starting early, when girls are young is critical to building confidence. Clubs like Girl Scouts that teach resilience, group activities such as sport and the arts, school financial education programs, and strong female role models are some of best ways to boost girls’ confidence.

The Confidence Code for Girls, points to their finding that

Between the ages of 8 and 14, girls’ confidence levels fall by 30%!

Confidence Code for girls

At 14, when girls are hitting their low, boys’ confidence is still 27% higher. And the effects can be long lasting.

I, along with my co-leader, have guided a troop of Girl Scouts for the last 6 years. The girls embark on activities that involve a degree of risk and put them out of their comfort zone. As they embrace risk and the chance of failure, they learn the important skill of recovery.

Taking the fear out of failure allows our girls to take a chance

Kathleen McDowell, Troop Leader and Founder of Live Richly

Taking the fear out of failure allows our girls to take a chance and for their fellow scouts and leaders to remind them “You’ve got this!” (Girl Scouts – building courage, confidence, and character). I much prefer the unofficial motto “Girl Scouts – not asking permission since 1912.”

My daughter, now 11, and her fellow scouts and school mates participated in a Girls on the Run program last month. The program aims to build confidence and other important life skills through interactive lessons and physical activity.

My daughter would never have thought she could run a 5k – but she did so happily, quickly, and faster than me, all with her friends chanting “You’ve got this” along the way.  She wanted to run faster near the end, but was afraid to, as she had no idea how far the finish line was or whether she could make it to the end.

This is the same fear millions of women have in finance, having no idea how far their money will take them and if they’ll have enough in the long run.

I told her to wait until she had the finish line in sight, and then empty her tank. And she did, blazing right past me and over the line. But that’s how it’s meant to be, with us letting our kids go further and faster than we ever did.  If she had slowed down, I could have passed the baton onto her. Not a chance.

So now I’m trying to pass on the baton as best I can. I am in the initial stages of putting my 30+ years in financial services to good use, presenting a course with critical skills to teach young girls about finance. 

How to understand it, manage it and leverage it

to put them on the path to living a rich life.

A life full of laughter and adventure, free of money stresses that wreak havoc on our life and relationships. All the stuff I was never taught at home or in school and had to learn the hard way over more than a decade.

My vision is to have all young girls know about, talk about and be confident about money matters and to be financially secure and build wealth for their future.

I can’t wait to share it with the girls and give them a real head start and a vision of the finish line!

A new study from Fidelity reveals:

Teen girls want more financial education: 81% of teen girls say they’d like to have more hands-on ways to learn about investing and personal finance.

Eight in 10 teen girls say they wish their schools had more resources on topics like personal finance and investing, while 66% would like a family member to teach them about money and investing.

About 70% of teen girls say they are most likely to look up to their mothers as financial role models.

FIND HAPPY. LIVE RICHY.

For more information on my upcoming Financial Literacy Program for Tweens and Teens, reach out to me at [email protected] and I will keep you updated on its development and get your input along the way.

For more information on programs in your area to build girls confidence, visit Girl Scouts and Girls on the Run. For book collections dedicated to raising smart, confident girls, check out A Mighty Girl.

If you know of other great programs for building girls confidence, please share!