Smart Investing

Unlocking Financial Empowerment: 4 Eye-Opening Stats Igniting the Need for Women's Financial Education

Compass - Shutterstock photo
Credit: Shutterstock

By Tammy Trenta, MBA, CFP, CTC, CEXP, Founder and CEO - Family Financial

I wasn’t born into an environment that prioritized financial literacy, but life’s curveballs came along just the same.

As a young woman going through a rough patch, I could have easily become a victim of circumstance; through a series of unfortunate events, I found myself at a place where I knew I’d either sink or swim. Financial knowledge became my life raft, and I quickly learned what I needed to learn to survive and thrive. 

It’s a familiar story for many; you navigate through life, managing a myriad of responsibilities, and then—boom—you suddenly find yourself confronted with the need to really understand money. Whether facing a divorce, a job loss, or some other unexpected transition, embracing financial literacy can keep a nasty curveball from becoming a vulnerable position.

I often think about how financial education turned my luck around—and how things could have been quite different. Curveballs don’t discriminate based on gender, but the world often does; even in 2024, women are statistically less likely to have fundamental knowledge about money topics and more likely to fall on hard times. 

This has to change.

As roles evolve and more women take on diverse responsibilities, the importance of being financially savvy is underscored; it’s really about fostering independence. By having more than a baseline in concepts like budgeting, investing, debt management, and estate planning, women can assert greater control over their financial lives. 

And while the statistics are sobering, understanding them gives us a great opportunity to work toward meaningful change. Here are four eye-openers.

1. Women have a longer life span and are 80% more likely to be impoverished in their golden years. Women generally outlive men by about 6-8 years, boosting the need for adequate retirement savings and healthcare planning. 

Because of advances in healthcare, someone who would have ordinarily passed on years ago may be living with a condition today. And women are often faced with even longer periods of caring for an ill spouse. These are circumstances that can create tremendous amounts of financial pressure.

I recall a client who was 75 years old and taking care of her suddenly ill husband. Although he had long-term care insurance, she wasn’t the one who purchased it and didn’t know how to make the claim. (Insurance companies bet that you’ll be overwhelmed, and they don’t make things easy.) I share this story to drive home the importance of understanding your assets and having a plan in place for the unexpected.

2. The wage gap is very much alive. Women earn approximately 82 cents for every dollar earned by men. Over the course of a career, this can result in a wage gap exceeding $400,000. 

This part should be simple: Women deserve equal pay for equal work. Sadly, we’re still fighting an uphill battle where many employers hang on to disproven, sexist perceptions. We’re also in a society where speaking openly about salary is considered taboo. 

So it’s crucial that we become comfortable advocating for ourselves. It does seem like the tide is turning—albeit slowly— as corporate accountability gives birth to more policies around wage transparency, paid family leave, and flexible working arrangements. But in the meantime, let’s be clear on our worth and fight for every dollar we deserve.

3. Almost half of women are the breadwinners. Approximately 41% of mothers are now the primary breadwinners. This means it's especially important for women in these roles to take proactive steps like building emergency savings, creating a comprehensive budget, and investing in long-term financial goals. Seeking out financial education resources and networking opportunities can empower you to make informed decisions and navigate the financial landscape with confidence.

4. Women tend to invest 40% less money than men. This could stem from a multitude of reasons, ranging from societal norms, to historical inequalities, to the willingness to invest. Statistically speaking, women tend to be more risk-averse, prioritizing capital preservation over higher returns. 

The male-dominated investment industry may be an additional deterrent to overcoming the above by seeking out an advisor. Increasing diversity in the investment sector is critical to fostering greater financial inclusion and equality. And women can also benefit from working with Certified Financial Planners who are also fiduciaries—rather than a broker. Often, such planners may offer a more holistic approach to financial advice—one in tune with the unique needs of women investors.

Financial literacy is a cornerstone of empowerment. By equipping yourself with the knowledge and skills to make informed decisions, you’ll be better equipped to navigate the highs, the lows, and the occasional nasty curveballs—giving you greater stability and peace of mind throughout your financial journey.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Personal Finance

Tammy Trenta

Tammy Trenta, MBA, CFP, EA, CTP, is the Founder & CEO of Family Financial, a wealth management firm based in Los Angeles, CA. With 25 years of industry experience, Trenta believes in a holistic, 360 degree approach to wealth and financial management, integrating financial, tax, and legal guidance to help clients accelerate their wealth and keep more of what they earn. Family Financial (FF Advisors, LLC dba Family Financial) is a registered investment advisor.

Read Tammy's Bio