Today’s episode of Two Cents is all about the ladies.
Oh.
Should I go?
No.
You should listen.
Okay ladies.
Time for a little real talk.
Women report feeling high or overwhelming levels of financial stress twice as often
as men.
Why is that?
There are two major reasons:
The first is compensation.
The gender pay gap is real and it is nasty.
In 1988, American women made an average of 66% of what a man would make in an equivalent
position.
And today, that number is up to…
80%.
And during that same period, women have had to shoulder more financial burden, with dual
income households on the rise, and 42% of today’s mothers with children under 18 being
the primary or sole breadwinner.
And this has life-long implications.
The less you’re paid, the less you’re contributing to social security, which means
we have to be setting aside MORE of our already smaller paychecks for retirement.
And that doesn’t even take into account the fact that we tend to live longer, which
is hardly a plus if you’re spending the those extra few years in abject poverty.
The second reason is confidence, or a lack thereof.
In my research and professional experience, I have seen women consistently undervalue
their money management skills--even when they tend to make the right decisions!
In a University of Cambridge study, just 42% of female business owners said their business
is prospering compared to 62% of males--despite the fact that the female-run businesses reported
higher average profits!
Less than half of women said they’d be comfortable consulting a financial professional, and only
20% said they discuss money with friends and family.
That doesn’t leave a lot of opportunities to increase your skill set.
Shrinking that wage gap is a long-term, collective battle, but you have more personal control
over your financial confidence, and it starts with learning why women are actually GREAT
with money.
Women are better investors!
Only 43% of women said they were confident in their investments, but a 2014 study showed
that women outpaced equivalent male investors' returns by 12%!
Why?
Because women tend to be more conservative investors and think of their financial picture
more holistically.
Men, on the other hand, are more focused on achieving certain rates of return, which drives
them to buy and sell more often and be more likely to hop on trendy bandwagons like Tesla
and Bitcoin!
This impatience means that men are 25% more likely to lose money on their investments.
And the same thing seems to be true in the bond market!
During the past 15 years, women run fixed-income funds outperformed the average returns of
those of run by men.
Women manage debt better!
Although we typically earn less, there is evidence we are better at managing personal
debt.
Back in 2015 Experian came out with a study that showed on average, women had slightly
higher credit scores than men.
And men tended to have more consumer debt on the books.
According to one study in the developing world, women had a 97% payback rate on micro-loans
extended to them and were far more likely to reinvest back into their businesses rather
than blow it on luxuries like men tend to.
Women make excellent business owners!
- Women now account for 40% of new entrepreneurs in the United States.
And many of them are killing it!
According to a Harvard Business review study, women tend to excel at influencing others
to support their vision, and managing operations behind the scenes, especially when resources
are limited.
We’re pretty used to having to make the most of what we’ve got.
And we are gaining ground!
Approximately 40% of U.S. working women now out-earn their husbands.
And over the next decade, women will control two-thirds
of all consumer wealth in the United States,
with many female baby boomers experiencing a double inheritance, from parents and their
spouse.
We’re also getting more educated!
In 2013, women earned 56% of all bachelor’s degrees and 60% of all master’s degrees.
And we hold the keys to the greatest economic tool on earth: 75% of women reported that
they were the primary shoppers for their households.
Which means we are making the decisions that determine which products and services prosper.
Obviously, this is a topic I'm passionate about and a short video simply can’t cover
all the problems and possibilities women face.
But if I can leave you with one thing it’s this…financial empowerment will NOT be given
to you.
It must be claimed.
And that’s--
So let’s stretch out our hands ladies!
Do it for yourself and the ones closest to you.
They’re following your lead whether you realize it or not!
And that’s our--
And that is my ONE cent!