It wasn’t until the 1960s that women were able to open bank accounts on their own. However, in recent years, women have taken the reins when it comes to household finances, with more than half of women managing their household’s long-term savings and investments.
Disappointingly, women still face pay disparity in the workplace, with women of color seeing the worst impacts, decades later. In honor of Women’s History month, we’re digging into the state of financial wellness and resources for women.
The Impacts of COVID for Working Women
Due to existing inequalities, women are more likely to face adverse effects due to the COVID-19 pandemic than men. Unfortunately, school and daycare closures have further increased the unpaid workload on women. Since men are often considered “breadwinners” and women “caretakers”, the increased burden of childcare and household responsibilities has fallen on women.
Opportunities to Reduce Wage Disparities
It’s disappointing that women still face wage disparities in 2022. For anyone leading a team or in charge of salaries, we encourage you to adopt a compensation formula, where wages are determined by a set of factors, including role and cost of living. Buffer is a great example of a company doing this well.
For women working to level the playing field, there are a few pieces of advice you can implement.
When accepting a new role, never accept the first offer. Always negotiate for what you deserve. Use Glassdoor to understand what an appropriate salary is for your role and experience level.
Discuss Compensation Openly
In the workplace, don’t be afraid to discuss your pay. Discussing your salary with coworkers shouldn’t be taboo. Openly talking about your compensation is one of the most effective ways to eliminate wage disparities.
Build a strong network. It’s valuable to build a network of others in your industry that whom you work well and can speak to your strengths. You never know when you might be looking for a new opportunity. Consider joining How She Works, a meetup community for women looking to network. FLIK is another community for women to join and network with each other.
Track Your Wins
Always document your wins. Create a brag sheet to remind yourself of how awesome you are and to use when applying for new roles, or asking for a promotion or raise.
Make an effort to learn something new every day. Keep yourself updated on the latest trends in your industry and invest time in learning something new. Spending time improving yourself isn’t selfish!
Finally, remember to support others. Once you’ve made it to the top, reach down and pull other women up. Whether that’s donating to female-oriented causes, volunteering your time to mentor other women, or speaking up in meetings to ensure your female colleagues are heard, you can make a huge difference.
Financial Wellness Resources for Women
With the increased challenges women face, it’s essential to explore financial wellness resources for women. Across saving, investing, and giving, women deserve the same personal finance support as anyone else.
Build a Budget
Everyone should create a budget. The first step toward financial wellness is understanding how much money you have coming in and where it goes. Document all of your income and your expenses, then determine what you’ll do with the leftover money. If you haven’t yet, focus all of your leftovers on building an emergency fund. After that, you can begin saving for other goals, investing in your future, and giving to causes you care about.
Establish an Emergency Fund
Once you’ve built your budget, it’s time to build an emergency fund that you can rely on in the event of something unexpected, like your car breaking down or losing your job. Start by saving $1,000 toward your emergency fund, then work up to 6-months of your expenses. Keep your emergency fund somewhere safe and accessible, like a savings account. You don’t want to accidentally withdraw from it or invest it in volatile stocks. Check out First Women’s Bank as a spot to store your emergency fund.
Invest Toward Your Future
After you’ve established your emergency fund, you can begin using your excess income toward other goals. One important financial wellness strategy is investing. Investing is a powerful way to grow your savings exponentially. However, only 33% of women see themselves as investors. Still, women’s portfolios outperform men’s by .4%. If you’re unsure of where to start, Ellevest is a powerful investing app, designed for women. Be sure to also consider impact investing, an investment strategy with philanthropic impact.
Save for Retirement
Along the same lines as investing, it’s important to start saving for retirement early. Women often need more savings for retirement than men since women live longer on average. Be sure to take advantage of work-sponsored retirement accounts, contribution matching, and HSAs. As you’re able, max out your Roth IRA each year. The sooner you start investing in your future, the more you’ll earn from interest.
Despite all of the disparities women face when it comes to finances, women are more likely to donate to charities, with additional research showing women are more generous than their male counterparts. As you’re able, it’s important to introduce charitable giving into your budget. Whether you’re donating funds, goods, or your time, you can make an enormous difference on causes that mean the most to you.
Empower Your Children with Financial Literacy
For parents of all genders, the only way to change things for the future is to establish strong financial wellness habits by empowering all your kids with financial literacy. Most important is to educate all of your children the same — regardless of gender and demonstrate well-rounded financial habits within your home.
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