Numerous studies indicate that many women face a financial gender gap. The good news is that it?s possible for them to catch up, and even get ahead.
This blog post was written as part of a sponsored program for State Farm?. All views expressed are entirely my own, and were not influenced or directed by State Farm.
A few years ago, the White House released a report on the social and economic well-being of women in America. The findings in the report are still largely applicable today. Research on lifetime earnings, retirement savings, and investments still indicate a financial gender gap between men and women. Women are more likely to put careers on hold to become caregivers, and they are also expected to live longer than men, creating a situation in which women are prone to ending up financially insecure.
If you are concerned about your future finances, it?s possible for you to catch up ? and even get ahead. Here are some ways that you can close the financial gender gap:
Many women find it rewarding to stay home with their children. However, this can mean that you miss out on retirement plans offered by employers. You don?t have to rely on an employer, though. It?s possible to open an IRA and have your spouse make contributions.
This type of vehicle is often referred to as a ?spousal IRA.? You don?t need earned income as long as it is your spouse making the contributions to the account. This can help you beef up your retirement savings, even if you don?t have a traditional job.
If you do have a traditional job, check into your retirement account options, and consider increasing the amount you set aside for the future. You can open an IRA on your own if your employer?s options aren?t right for you. Do your best to contribute as much as you can to a retirement account now, and it will benefit you in the future.
Boost Your Earning Power
You might be surprised to learn that women leave as much as $500,000 on the table over a lifetime. One way to close the financial gender gap is to boost your earning power. Negotiate for higher pay when it?s warranted (and there?s a good chance that it is warranted; don?t let impostor syndrome hold you back).
Added skills, education, and certification can also help you boost your earning power. Also, thanks to technology, it is possible to earn money from home. I know many stay-at-home moms who make extra money each month from home. Even a couple hundred extra bucks each month, saved in an account meant for your future, can go a long way toward closing that financial gender gap.
The more money you earn, the more you can save and invest for the future. Putting that extra money to work for you can make a huge difference later on.
Great news ladies: according to research, women are actually better investors than men. This is a generalization, of course. Large trends might not apply specifically to individuals. Even so, this is interesting research that indicates that women could do quite well for themselves through investing.
Unfortunately, even though women can be better investors than men, the reality is that many of us don?t invest. If you want to close your own financial gender gap and get ahead, investing should be a big part of your financial foundation. Start small and simple with your investment choices, and ask for help if you need it. Over time, even little investments start to add up. Make it a point to begin learning about money and investing, and you might be surprised at how much you can accomplish.
If you are afraid of falling into the financial gender gap, you can turn things around. Take a step back and look at your situation, and see if there?s a way for you to make up the difference. Chances are, you really can thrive, no matter your situation.