Financial Security for Women: Closing the Gender Wage Gap #WMWeek17

This week, January 1-7 2017, is National Women’s Money Week #WMWeek17 and there is no better time to learn about, discuss, and attempt to correct the disadvantages that women face in the world of personal finance and in their own financial future. I think we are all quite familiar with what is known as the gender wage gap, the fact that women earn less than 80% of what men do. Equal pay for equal work is an ongoing struggle that is making just small inroads at best. You may be surprised to learn that the wage gap itself is just the tip of the financial iceberg that hinders women and their abilities, and potential for financial security and independence. The vast majority of adults in poverty in America today are women.

 For National Women's Money Week, we take a look at the gender wage gap, what causes it, and more importantly what can be done to close it.

What causes the gender wage gap?

There are several reasons why women, even in the 21st century, are facing roadblocks to financial security and there is more to it than systemic sexism and discrimination (which certainly play a large role). Let’s look at a few issues first that are influencing women and their continued lack of financial equality in the workforce which hinders their overall financial wellbeing:

  • Women tend to choose different career paths or industries than men, often because they tend to be responsible for the family caretaking responsibilities.
  • Because of these career path differences, women miss out on promotions and wage increases that come with increased responsibilities.
  • If women are responsible for family caretaking, they can lose a number of years in the workforce that may even cause them to fall backwards in rank if they return to work.
  • Women are underrepresented in business leadership.
  • Women live longer than men and need a source of funds to help them during their later years and into retirement for a longer period of time than men.
  • Social Security benefits are lower for women because their wages are lower and their working careers are shorter on average than men.

How do women contribute to the gender wage gap?

  • Some women tend to “accommodate” their partners by foregoing their own potential and not pushing for alternatives to family and child care.
  • Women often hesitate to negotiate job terms and positions and settle rather than bargain effectively.
  • Women are often less aggressive than men in the workplace and are sometimes more intimidated by their male counterparts.
  • Women more often than men don’t seek legal support when they may be discriminated against.

What can women do to improve their financial situation?

  • Women can increase their knowledge about investing. The markets do not discriminate against women, and their money can earn and grow just like anyone else’s if and when they apply an investment strategy.
  • Women should talk to their life partners to understand their financial and retirement plans and determine how it will affect them.
  • Women need to plan for their continuing education and take courses to be able to better market themselves in the workplace.
  • If a non-working spouse, the woman should make sure that a spousal retirement fund is set up from the principal bread winner’s income.
  • If working only part time or not working outside the home, women can investigate a “side gig” to establish an income and use their knowledge and skills to create a path towards financial security.
  • Women can practice negotiation skills to become more effective in earning their worth.
  • Women should make sure they are aware of all life insurance and annuity plans their life partner has in place and how it may affect them and their children.
  • Women can and should influence employers to make new policies for women to help retain their valuable full time employees and keep family care givers on payroll which is a win-win for all concerned.
  • And women can continue to push for solutions that will help to close the gap, such as pay transparency and the elimination of negotiations.

While there has been progress in many areas of employment and opportunities for women, the 21st century represents what women want as the final stage of full equality in workplace issues. It starts with more opportunity and increasing responsibilities but must include wages and benefits for women on a level with their male counterparts. National Women’s Money Week 2017 is the perfect time to engage in and plan how this goal can be accomplished right now!

What ideas do you have that can help women to improve their financial wellbeing in the workplace? What problems have you faced and how do you try to overcome them?


  1. Emily Jividen

    One thing I read recently on a parenting site was the fact that girls (and women) tend to try to check all the boxes when they submit schoolwork, go for a new job, or try something. They think they have to be perfect. Boys (and men) are more willing to try and fail, to take a risk, in part because we raise them to do so. So women are more likely to limit their possibilities.

    And I’ve noticed with my own child that she thinks what she does is worthless if not right, and wants to give up. Knowing this is both helping me encourage her to take more risks and accept less than perfect, and to be that way myself.

  2. Lindsay @ Notorious D.E.B.T.

    My career field is largely employed by the federal government, and so there is no room for salary negotiation.
    It’s good and bad: I don’t have to worry about haggling over my salary, but the salary I make (along with the dudes) is very low compared to other careers.
    That’s why I’ve had to work on the side, and I HAVE had to negotiate my payment there, and it is a very weird experience. But I’m glad I’m getting to flex that muscle in one way or another at least!

    1. While the financial rewards of your “day job” may not be as lucrative, there are obviously other benefits that make that job worthwhile. Having a side hustle can offer some added financial security as well as prepare you in case you ever choose to enter the private sector full time. It’s good that you have the chance to develop those negotiation skills now. Thanks for your comments, Lindsay.

  3. All so true. I feel that our millennial women may have a better opinion of themselves and their male peers. Hopefully, if I’m correct, the up-and-coming women will close the wage gap.

    As your article states, it isn’t just workplace gender bias that causes this gap.

  4. The issue of assertiveness in the work place is a hard one because often if we do asset ourselves, we get lake labelled in a way men do not.
    I do agree that choosing other fields and believing that you can make it in those fields will help. There is still a gap when you norm out for that, though, and it gets bigger the longer your career goes on. Negotiation is also huge–freelancing has really helped me grow in that area.

    1. It is difficult, I’m sure, to walk the fine line between being assertive and being seen as a b@&#*! I must be one of the more enlightened males (at least I hope so) in the fact that I only judged people in the workplace based on performance, and hopefully that’s going to become the rule, not the exception. But while it’s not, women will still have to come away from the stereotypical behaviors that may have hurt them in their career advancement. Thanks for your comments, FF.

    1. I’ve always been a firm believer in controlling my own destiny and, when it comes to women’s equality in the workplace, I think that rule applies as well. If we just depend on others to help us succeed, unless you have a rich uncle, it doesn’t usually work well. At least that’s been my lifetime experience. Thanks.

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