Owning a life insurance policy is a key step towards improving your financial health and building a generational legacy. It’s something everyone should have, but men still outrank women when it comes to purchasing life insurance. Data from the Life Insurance Marketing and Research Association (LIMRA) indicates that while 78% of women consider personal finances to be very important, only 31% consider buying life insurance.
This disconnect between priorities and action could be the result of deep-seated stereotypes about women and finance, women’s lack of access to financial advisors and information, and the gender pay gap. Haven Life’s Gender Roles and Life Insurance Survey found that women are more likely to do household chores such as cooking, grocery shopping, and looking after children and pets than their male partners.
Women do it all, but many also seem to internalize the nefarious notion that men are better at managing money.
As a young woman, I decided to take control of my financial future and made an appointment with a financial consulting firm. Little did I know I had made an appointment with one of the company’s top executives – someone not used to providing advice to clients with a net worth of less than 500,000 $. As you can probably imagine, our meeting to discuss managing my student loan debt was brief and awkward.
Some women, who grew up around strict gender stereotypes and roles, may feel embarrassed to disclose their financial situation, take charge and stand up for themselves.
For example, when it comes to pay equity, I never knew if my salary was lower than that of my male colleagues. However, a 2022 study found that women earn on average 82% of what men earn, which is similar to the pay gap 20 years ago. For me, that means investing at least 18% more to close the pay gap and make intentional, informed decisions with available funds.
As women, we need to understand our finances. Studies show that women spend more time researching their investment choices than men and are more likely to take appropriate levels of risk. Women can take more charge of their financial future in the following ways:
- Use online digital tools and take ownership of your financial education.
- Understand personal finances and learn the basics of budgeting, saving, investing, and retirement.
- Set clear goals and develop, perhaps with the help of a financial advisor, a plan to achieve those goals with a built-in margin for error.
- Stay optimistic about the possibility of achieving your financial goals. Women need to feel empowered to succeed. It is difficult to save and invest for the future if one is completely pessimistic.
For example, one of my exciting accomplishments was paying off my student loans in my early thirties. When we identify clear goals and achieve those milestones, even the smallest ones, we establish a virtuous circle that builds trust and leads to even better results over time.
Women who take charge of their financial future by prioritizing financial literacy are doing their families a favor and positioning them to accumulate generational wealth.
Access is power
Earlier, I shared an account of my first unsuccessful meeting with a financial advisor. A negative first experience can make women hesitate before going any further, especially when there are preconceived ideas.
Technology helps women get a complete picture of their financial health, which can help them overcome societal, cultural, and family expectations that they put money management on the back burner. Online services can help bridge the financial literacy gap and help women access professional-quality advice when, where and at a price that suits them. Access to one-on-one consultations with automated advisors, online insurance calculators, and other tools better equip women to protect themselves against life and market uncertainty.
Online services also provide women with a degree of anonymity that takes away some of the fear of embarrassment or added costs of seeking financial advice. After all, Google won’t wince if you ask a basic question.
Clarity and confidence
The persistent gender pay gap and impending recession underscore how important it is for women to prioritize their financial health. Yet women are often reluctant to take control of their finances. How often do we allow ourselves to be persuaded that someone else “knows better” or that we are not well informed?
Often these assumptions are simply wrong. We usually know more than we think, and it becomes a matter of time and perseverance to keep learning. Knowledge, like interest, accumulates over time.
Sahang-Hee Hahn is Head of Strategy and Planning at Haven Life.
More: Women are less likely to get more money when negotiating a starting salary
Read also : The gender pay gap in the United States has barely budged in the past 20 years.
April is National Financial Literacy Month. To mark the occasion, MarketWatch will publish a series of “Financial Fitness” articles to help readers improve their financial health and offer advice on how to save, invest and spend their money wisely. Learn more here.