Important Facts About Women and Money

illustration of women talking, surrounded by images of charts, graphs, money symbols

The Balance / Joyce Chan

“This is going to be wildly depressing.” You know the state of gender equity isn’t good when those are the opening words for a presentation on the topic.

But that’s the truth. And that’s how Claire Wasserman, author and founder of Ladies Get Paid, kicked off the 2021 Finance Festival, a series of virtual events designed to empower women to take control of their wealth and future. The events run from April 14-28 and are hosted by Ladies Get Paid and trading platform/social network combo Public.

“I want you to get really mad—get really friggin’ mad,” Wasserman said before listing a series of statistics about gender and racial wealth gaps. “I want you to say, ‘Screw you statistics, I’m going to close my own gap. I’m not going to wait around for the system to welcome me into it.’”

In order to push for equity (and systemic changes that enable it), we need to understand where we’re at.

Key Takeaways

  • Women earn 82 cents for every $1 men earn, and the gap is wider for Black women and Latinas
  • Women hold two-thirds of student loan debt in the U.S.
  • Fewer women invest than men do. One survey said only 52% of American women say they hold stocks, and another said only 23% say they invest in financial markets.

The Wage Gap Is Persistent

There are multiple gender wage gaps, because you can look at a variety of data and slice it in different ways. There are gaps between women and men of the same race, and there are the gaps between men and women of different races. On top of that, there’s how those gaps vary by age groups and whether or not you’re looking at hourly or full-time workers. The numbers tell different stories but all show inequity.

Here are just a few of the many ways to look at it, based on 2019 data on full-time workers from the Current Population Survey, a joint venture between the Bureau of Labor Statistics (BLS) and U.S. Census Bureau: 

  • Women earned 82 cents for every $1 earned by men. 
  • That gap is wider among older adults. For example, women ages 55 to 64 earned 76 cents for every $1 earned by men of the same age.
  • The gap is narrowest among those ages 20 to 24, but even those women only earned 90 cents per $1 earned by men.
  • White women made 81 cents for every $1 made by White men. Meanwhile, Black women made 68 cents and Latinas made 62 cents for every $1 made by White men. (The data shows near parity between Asian women and White men but a 33-cent gap between Asian men and Asian women. However, the Current Population Survey notes that the small sample size of Asians in the data contributes to large variances in estimates for the group.) 
  • Women earn less than the men who work in their fields, in the vast majority of industries, according to data broken down by occupations as categorized by the BLS. “Securities, commodities, and financial services sales agents” had the largest gap with women earning 64 cents per $1 earned by men. The greatest gap in the other direction was among “Combined food preparation and serving workers, including fast food,” where women earn $1.16 per $1 earned by men. (The most recent data, based on 2018 wages, has wage gaps on only 154 of 564 occupation categories.)
  • The wage gap gets worse when parenting enters the picture. Among parents without children younger than 18, women earned 85 cents per $1 earned by men. But if a woman had a child younger than 18, she earned 74 cents to the $1 earned by a male parent with a child under 18. Parents generally made more than non-parents—but male parents made much more.

Some researchers estimate the above gaps to be even wider.

Earnings Aren’t the Only Discrepancy

Not only do women tend to earn less than men, they often have to make those limited resources go further. Women, particularly Black women, hold more student loan debt than men. 

  • Women hold two-thirds of student loan debt, according to a 2017 analysis of student loan debt by the American Association of University Women (AAUW).
  • Black women with education debt borrowed, on average, $37,558 for college, while White women borrowed an average of $31,346, the AAUW estimated. 

Women also have a longer life expectancy than men. Even the most math-averse person knows that spreading fewer resources over a longer period of time isn’t a great situation. 

Many Women Hesitate to Invest

Only 55% of Americans own stocks, according to June 2020 data from Gallup, showing that many people, regardless of gender, avoid dipping their toes into the market. Women are less likely to hold stocks—52% to men’s 58%—and the disparity by race is striking: 

  • 64% of non-Hispanic White people own stock
  • 42% of non-Hispanic Black people own stock
  • 28% of Hispanic people own stock

The data doesn’t break out investors by gender-race, but the lower prevalence of female investors and large gaps between White, Hispanic, and Black investors suggests women of color are much less likely to own stocks than men and White women.

While holding stocks is not the only way to invest, it’s a very common tactic, and the Gallup numbers suggest there are barriers between would-be investors and people who actually do it. Having money to invest is certainly one of them: Only 22% of people with an annual income of less than $40,000 own stocks, while 65% of those earning $40,000 to $99,999 do. 

Confidence and socialization also play roles. Surveys of married, divorced, and widowed women by wealth management firm UBS brought this into sharp relief: 56% of married women leave long-term financial and investment decisions to their husbands, and 85% of those women do so because they believe their husbands know more about money matters. The women who no longer had husbands—divorcees and widows—warned against this, with 98% saying women should take a more active role in finances.

It’s not as shocking as it sounds, given that women couldn’t get credit on their own until the Equal Credit Opportunity Act of 1974 barred creditors from denying people on the basis of their race, sex, and marital status (among other things). Not even half a century removed from being denied access to financial products because of their gender, women have to unlearn what they have been taught about financial products not being “for them.”

“Way too often, we as women internalize something that happens. We think, ‘What’s wrong with me?’” Wasserman said, adding that it’s “how we’ve been socialized.”

Yet another survey shows the disconnect: A 2019 investor survey from S&P Global found that only 26% of American women had investments in the financial markets, even though 41% thought it was a good time to do so.

What Can Women Do?

While wealth gaps (and this article doesn’t touch on all of them) have generally gotten narrower over time, there’s a long way to go to parity. Getting there isn’t simple, but education and conversations help with progress.

“We don’t ask for help because we don’t want to be a burden,” Wasserman said. “We don’t want to admit what we don’t know.”

But a willingness to ask questions makes a difference. It not only helps you learn but it shows other women with the same questions that they’re not alone, she added. 

“What is the first step of financial literacy for women?” Wasserman asked. “It’s any question you have, being unafraid to ask it.”