Let’s take a look at four real concerns women face today.

Women and wealth

Women have been fighting for equality since the days of America’s forefathers, yet when it comes to finances, as of 2018, 35% of millionaires were women and by 2030, women will control two-thirds of the nation’s wealth, according to the Family Wealth Advisors’ Council.

Society expects women to plan for many things, like vacations or weddings – but it doesn’t expect them to plan for their financial futures. With 92% of women wanting to learn more about financial planning, according to Fidelity Investments’ 2015 Money FIT Women Study, it makes sense to dedicate financial planning services to women.

The gender pay gap

On average, women earn 80 cents for every dollar earned by men, according to the National Partnership for Women and Families 2018 report. This statistic shows that the pay gap is real. It’s so real that on January 16, 2019, Citibank even stated that their female employees did make 28% less on average than male employees, but they also pledged to reduce that gap moving forward.

Some countries are making strides in closing this gap. Last year, Iceland outlawed the Pay Wage Gap on January 3. In the United States, it is difficult to navigate pay since pay transparency doesn’t exist in most US companies.

While pay transparency is still a work in progress, in the US, Equal Pay Day was recognized on March 14, 2023; this date marks how far into the year women must work to earn what men earned in the previous year.

Women and careers

We have unconscious and conscious biases against us in the field of finance. Women been told that when they get to a certain asset size they can “play with the big boys.” They’ve heard, “Why is your hair so long?” “Why is your hair so blonde?” and “Why are you so happy and smiling, you must be deeply insecure and hiding something.” It’s worth wondering whether any man has had to deal with these types of questions in this profession.

The confidence gap

Studies show women generally underestimate their abilities and knowledge, which can impact risk tolerance and therefore investment returns. In our experience, women are more risk averse. They hate to lose money and feel that they can lose it all in the stock market.

Here at United Capital Financial Advisors, we like to show women Callan and Ibbetson charts. We tell them the only way they can lose it all is if they put all their money in a stock that goes bankrupt, or if they invest in a Ponzi scheme – and with us, neither scenario is going to happen. We also have seen women hoarding cash because they think it is safer. We have to explain how inflation hurts them and how they are losing money with low rates, taxes, and inflation.

When it comes to going for jobs or speaking up at a meeting or promoting yourself, there is also a confidence gap. These can be very difficult things for us! It’s often the case that women have to have all 10 skills to go for a job while the guy who only has three goes for it too.

As women, we have to educate each other, talk more about money, and help each other professionally. Mentorship and sponsorship is a great place to start. Let’s help each other change herstory and make the hashtag come to life: #thefutureisfemale.

This commentary contained herein is intended for informational purposes only and should not be construed as tax, legal or investment advice. Past performance is not indicative of future results. Clients should obtain their own tax, legal or investment advice based on their circumstances. The material is based on sources deemed reliable but is not guaranteed.

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