6 Strategies Women Need To Know About Money

Use our six strategies to weave a financial safety net that lasts a lifetime. 

- Sandra Block

CONSIDER A PAIR OF TWINS WHO GROW UP TOGETHER, have the same talents and education, nurture the same desire to raise a family, and embrace the same ambitions for their career. But in adulthood, one twin consistently earns less than the other, has a spottier work record and gets stuck further down the career ladder. That twin reaches retirement age with a smaller cache of savings, less guaranteed income and a real risk of running out of money later in life. //The difference between the siblings? Gender. In this parable of fraternal twins, the female twin earns 79 cents for every dollar the male twin earns. She takes more breaks from the workforce to care for children and other family members, and consequently has less access to employer-sponsored savings plans, such as a 401(k). She also has a smaller Social Security benefit, based on her reduced earnings. And here’s the real kicker: Because she has a longer life expectancy than her twin (a 65-year-old woman can expect to live to 85, on average, compared with 83 for a 65-year-old man), she will have to stretch her resources that much further.

Like all parables, this one is based in fact: the gender gap that has long put women at an economic disadvantage. The good news is that the gap is closing. Women now graduate from college in higher numbers than men and hold more master’s degrees. They represent almost two-thirds of the workforce, according to a report by U.S. Bancorp. The pay gap narrows considerably (often to the point of disappearing) for men and women with similar educational backgrounds and jobs. And to a large extent, differences in income and economic circumstances reflect women’s decisions about which jobs to hold and their choices (made with their families) about who stays home to care for kids or elderly relatives.