How Women Can Conquer Financial Inequality

Why It Matters:

  • Women face different financial challenges than men.
  • Planning for retirement may be more difficult for women.
  • There are ways women can overcome career and retirement roadblocks.

Kastle Waserman tkc.profilePicture Written by: Kastle Waserman | Transamerica
Aug. 29, 2019

5 Min readClock Icon

Women, we’ve come a long way since the landmark victory of gaining the right to vote in 1920. Since then, more women have entered the workforce, hold management positions, achieve college degrees1, and just this last year, in the 2018 midterm elections, more women were elected to Congress than ever before.2

Yet, despite all these accomplishments, we still face distinct personal finance challenges in earning power, the ability to invest, and plan for a secure retirement.

Many of us may not even be aware of the roadblocks that prevent us from achieving financial security. Those roadblocks can take a number of forms. Some of the key ones include becoming a caregiver for one or more family members (kids or aging parents/grandparents), taking a job that underpays, or even just letting your partner or spouse manage your financial decisions because you feel you don’t have the knowledge or time to do it yourself.

Well, ladies. It’s time to snap out of it.

Let’s break down some of the financial challenges women face, simply due to being female, and discover what we can do about it.

A woman’s life expectancy is 4.9 years longer than a man’s.3

While the population today is living longer, women have the mixed blessing in that, on average, they will outlast their male counterparts. That means they may live through life circumstances that could be costly — widowhood, more health issues, and more years in retirement.

How women can meet the challenge:

  • Plan for a longer retirement and what that would look like. It could mean continuing to work or pursuing an encore career.
  • Be in the loop with family finances and insurance coverage so you have as much knowledge as your partner does.
  • Maintain health through diet, exercise, and preventative care to reduce healthcare costs down the road.
  • Create a budget. Know what is currently spent on essentials and what might go up or down in retirement. See our previous blog on how to budget for retirement.


56% of women defer to a spouse on investments and financial planning.4

A majority of women are hesitant to manage their money. They often leave it to their partner to handle it on their behalf, which can put them in the dark on where the accounts are, how they are being invested, and if they are meeting the appropriate goals for their lifestyle and life span.

How women can meet the challenge:

  • Know what’s going on with your money. If you’re married, sit down with your spouse and go over where all the accounts are, what bills and loans need to be paid, what insurance coverage you have, what the plan is for emergencies and retirement, and if you’re on track for the long term.
  • Up your financial literacy game. Load your phone with audio books by Dave Ramsey, Suze Orman, and David Bach, or podcasts on personal finance. Bookmark personal finance publications so you have something valuable to read when you’re just browsing the web.
  • Take a personal finance class online or at a community college.
  • Meet with a financial professional who can guide you through understanding your financial picture (more on this below).


Marriages today have a 50% chance of lasting.3

Sadly, the divorce rate for today’s couples is at an all-time high. That includes divorce among those ages 50+. A split from a spouse can be financially devastating. Divorced women are more likely to live in poverty and receive public assistance than their male counterparts, according to the U.S. Census Bureau.5

How women can meet the challenge:

  • If you feel comfortable, arrange for a prenuptial agreement before getting married. If you’re already married, consider a postnuptial agreement to iron out details that came up during the course of your relationship.
  • Maintain an independent account. Know how much you have in your name and what you have comingled with your spouse. Know what your financial picture would look like if you were on your own.
  • Be sure to know all of the beneficiaries on your accounts. You will need to take your spouse off of them in the event of a split.
  • Don’t assume you can live off alimony and child support.
  • Be aware that a divorce can be hard on your emotions. Have your financial picture completely squared away and an exit plan in place while you are thinking clearly if you sense a separation may be coming.


On average, a woman earns 80.7 cents for every dollar a man earns working full-time.6

Women may have been fighting for workplace equality for decades, yet their salaries still fall behind men’s. Society is conditioned not to talk about how much they earn, so a woman may not even know if she’s making less than her male counterparts at her job. Websites like Payscale, and even Glassdoor can help you figure out if you’re paid comparably to others in similar roles. If you spot a gap, there are ways you can make up the difference.

How women can meet the challenge:

Make your money work harder – Invest more aggressively. The American stock market (S&P) has historically brought an average annual return of 10%7 — even with bumps and falls. So think long term in your strategy.

Generate more income – A side job will bring in extra money. But if you’re already working full time, you may be left with too little time and energy to take on any more work. Instead, see where you could cut unnecessary expenses. Also consider passive income by investing in rental real estate or dividend stocks.

Pay off debt – The interest charges from a debt is just taking money from you that could be used to invest or save for an emergency. Get rid of it as fast as you can!

Ask for a raise, for real – Keep track of your contributions to your company such as great feedback on a project and results that made an impact, so you can share your value with your manager. Also, know your worth so you know how much to ask for. Use sites such as Salary.com (and the ones mentioned above) to find out the competitive salary for your position in your geographic area. Need to get up your nerve? There’s a class for that! The American Association of University Women (AAUW) Work Smart offers an online class in negotiation strategies for a promotion or raise.

Build your skill set – If you’re not making the money you need at your current job, it may be time to move on. Look at job descriptions for the types of jobs that pay more. Build your skill set through LinkedIn Learning, SkillShare, Udemy and local college classes.

Women are less likely than men to be offered a 401(k) or similar plan, partly due to women working part time and employers not extending retirement benefits to part-timers.8

Faced with the cost of childcare and short maternity leaves offered by employers in the U.S., it’s no wonder workers need to take career breaks to care for little ones. And the majority of those taking the breaks are women. Many may need to do it again to care for aging parents. If an employer-sponsored retirement plan is the primary way you save for retirement, taking these career breaks can put a dent in your savings.

How women can meet the challenge

  • Modern technology is making working remotely easier for employees who may need to keep an eye on family members they are caring for. That flexibility can be a win-win for companies as they won’t lose a talented and dedicated worker. If your current job doesn’t allow working remotely, it may be time to find one that does.
  • If your skill set and experience can’t be applied to a job that can be done remotely on a computer or by phone, consider a career switch. Take classes to build up skill sets needed for those jobs.
  • Invest in your own retirement plan — depending on what your employer offers, you may be able to save for retirement and get a deduction on your taxes.
  • Start your own business. You may not get the kind of benefits offered by an employer, but at least you’ll be able to maintain an income that can be put toward an individual retirement account while doing caregiver duties. Look into what kind of businesses can be done from home, such as creating a website to do affiliate sales or ecommerce reselling, becoming a virtual assistant, or at-home teaching.


Only one in three women investing for retirement use a professional financial advisor.8

When it comes to managing their finances, few women are seeking the help of a financial advisor to plan for retirement. That means they are either doing it themselves or not doing it all. A financial professional can help you see the big picture of what money you have and what you need to live the quality of life you desire both now and in the future. They will help you create goals and meet them. Without a financial professional to guide the way, you may lose sight of your goals and progress.

How women can meet the challenge:

  • Invest in yourself by reaching out to a financial professional. Ask neighbors, trusted friends, or coworkers if they have one they can recommend. Then make appointments with at least three to find one you feel comfortable with.
  • Knowing what to ask a financial professional may be daunting. Go with a financial advisor you feel comfortable with and who understands your particular life situation and the challenges you face as a woman. Don’t hesitate to ask, “Would you advise me differently as a woman than a man?”

Women, don’t let anything hamper what your financial picture looks like. You can take control of your money and face challenges head on!


Empower yourself with our infographic on women and longevity. Hang it on your wall for inspiration or pass it on!


Things to Consider:

  • Women need to be aware of what financial challenges they face.
  • Don’t be in the dark about your financial picture.
  • A financial advisor can help you create a strategy for now and the future.
 

1 “Women in the Workforce,” Catalyst, June 2019

2 “’There’s Not Just One Women’s Lane’: A Record Number of Female Candidates Running for President,” CNBC, February 2019

3 “Women Need to Take an Active Role in their Financial Lives,” CNBC, April 2018

4 “Own Your Worth,” UBS, 2018

5 “Divorced Women Declare Financial Independence,” Investment News, July 2018

6 “ 6 Charts That Show the Glaring Gap Between Men and Women’s Salaries,” Business Insider, April 2019

7 “What Is the Average Annual Return for the S&P 500?” Investopedia, May 2019

8 “Here and Now: How Women Can Take Control of Their Retirement,” nonprofit Transamerica Center for Retirement Studies®, March 2018

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