Hidden Obstacles in Finance for Women

July 26, 2017 by Amanda Arient

about the author:

Amanda Arient

Training coordinator

Amanda works to improve the implementation process for customers through expert onboarding, creative instructional design, and personalized training. Prior to her role on the technology adoption team, she worked as a partner support specialist.

Generally speaking, women face many obstacles in finance today. The obvious and most prevalent obstacle a women faces when it comes to earning and saving money for their financial future is the gender gap in earnings. According to a 2014 press release from the Bureau of Labor Statistics, women earn roughly 83 percent of what men earn.

With a significant amount of women not saving enough for retirement, let us examine some other challenges that women face in regards to their finances.

Common financial obstacles for women

According to The Balance, here are some of the most common challenges women face in both personal and general finance.

  • During a market downturn, women are more likely to be unemployed than men.
  • When companies downsize personnel, women are more likely to be laid off.
  • Women work more lower-paying part time jobs than men.
  • Many women fail to be eligible for unemployment benefits because of lower wages and part-time hours.
  • Because of how often they work part-time, women are less likely to be qualify for employee benefits and employment-based retirement plans.

Since women tend to make less than men do in the workforce, it can be inferred that they will then make less later on in retirement. Because social security payouts are based on salary, women tend to earn less on those benefits, which is a major source of income for most retirees.

Not only do women typically earn less than men, but they have higher expenses than men. Lifestyle expenses, life insurance premiums, and added expenses that men do not have to worry about plague the average women’s budget.

Differences in expenses for women

According to Credit.org, “products designed exclusively for women are more expensive than those meant for men, women’s clothing is more likely to need dry cleaning, and women have to purchase things like cosmetics that men do not use.”

Women also pay more for required expenses as well. According to Time, women can expect to pay tens of thousands of more dollars on health care in retirement than men. Additionally, women have to pay for certain medical care and visits to healthcare professionals that men do not. The price skyrockets in many cases if a woman becomes pregnant, as doctor visits and subsequent medical attention becomes more frequent.

Next, women are overwhelmingly responsible for single parent households. According to the United States Census Bureau, over 80 percent of single-parent families are headed by a woman. When a woman does not get the financial support for her children, many women find they need to pick up the slack by working multiple jobs to make ends meet.

For financial advisors, knowing how women’s finances are impacted by external factors is vital. Women need to budget, and plan, differently to achieve financial freedom throughout retirement. When knowing how women’s finances are impacted, advisors can better cater their services to women and help them effectively plan for the future.

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