Women and wealth: Exploring the gender gap

Women, money and influence

Women have more money and power than ever before. And they’re more in charge of their own finances – and their everyday life – than ever before too. With 50 percent of U.S. adults being single,1 millions of women are running their own households.

Yet a Stanford University study showed women score lower on financial literacy tests than men: 3.33 versus 3.94.2 They’re also far less confident making major financial decisions.2 Of women in heterosexual marriages, 56 percent leave investment and financial planning decisions to their husbands – 85 percent of them because they think their husbands know more about finances.3

While the gender pay gap has improved from 60% in the 1950s,4 women still make only 85% of what men make today.5

Our recent Women and Wealth Insights Study sought to understand more about this gender gap in finances and the reasons behind it.

Women and Men Feel Differently About Wealth

When asked what emotions come to mind when thinking about managing their finances, men and women both said self-confidence first. Yet their #2 and #3 answers quickly departed.

Women

Men

1

Self-Confidence

Self-Confidence

2

Stress

Excitement

3

Anxiety

Happiness

Financial Security Matters More to Women

While the majority of men and women are motivated to create wealth because of the financial security it provides, that security is significantly more important to women. In fact, 72 percent of women say financial security is a “main motivator” versus 59 percent of men.

Women are also more concerned about having enough money for retirement, with 43 percent stating this as their top concern versus 33 percent of men.

Only 46% of women have participated in a retirement plan.7

Women Engage with Their Money Less

Women engage with their money less than men do – both in the tools they use and in how much they discuss their finances with friends.

Women

Men

I talk about money with friends

52%

61%

I use apps to track my finances

36%

48%

I listen to money-related podcasts

19%

30%

I watch money-related TV shows

28%

46%

In addition, only 72 percent of women younger than 35 use a financial advisor compared with 83 percent of men. And as our survey data showed, people who engage early with their finances are more confident with them long term.

What’s at the Root of These Differences?

The reasons for this gap in confidence and engagement with money are myriad – and understanding them completely requires a deep dive into history. At a high level, though, it’s worth noting that financial security may be a bigger challenge for women because their careers often take different paths.

Women hold:6

  • 27% of executive/senior-level positions
  • 21% of board seats
  • Fewer than 6% of CEO positions

Women are much more likely to take time out of the workforce, request more flexible schedules, or work reduced hours, so they can raise children or care for their aging parents. This movement in and out of careers can result in lost income, stifled career growth, less savings and potentially lower Social Security benefits. It can also mean increased vulnerability if a spouse dies or a marriage ends. And for women who seek to return to their career after time off, career advancement opportunities can be limited.8


Interested in learning more?

Download the full Insights Study to read additional insights:

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