Saturday, January 18

The Important Work of Financial Feminism

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Financial feminism is the advocacy and action for gender equality in personal finance. This includes, but is not limited to earned income, debt loads, taxes, and wealth accumulation. 

It has been my experience that the personal finance world is reluctant to have the conversation around gender. This is unsurprising because this space, like so many others, is primarily dominated by men. But the other reason is because it compromises the bootstrap narrative that so many personal finance gurus and bloggers cling to.

Acknowledging the impact of sexism on income and debt forces us to confront a painful truth: our money is not wholly in our control. External factors influence how far we can and will get when it comes to finance. 

Why do we need financial feminism?

When we think of the unequal distribution of wealth between genders, we tend to look only at the gender pay gap. However, the discussion is much more nuanced than that. While the gender pay gap is a huge issue, and perhaps the one that is felt most acutely, it’s not the only one. It might not even be the root cause of disparity in financial security between men and women. 

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What we need to recognize is that women and men have fundamentally different lives. Part of this can be attributed to biology, but it has much more to do with patriarchal gender roles and stereotypes. We can only do truly honest accounting by recognizing this and adjusting for it. 

Women earn less than men (duh)

The Gender Gap is real and persistent. Across all industries and professions, women continue to earn less than men for the same level of experience and education in the same job. 

The largest, but not the only, driver for this is women taking time away from their jobs to raise children. 

Women take time away from their career to be caregivers

This is actually the largest (but not the only) driver behind the gender wage gap. Women tend to interrupt their careers to be caregivers of children and elderly parents. 

When you leave the workforce for any amount of time, you experience a compounding effect on lost income. Not only do you miss out on wages earned for the hours you’re not working, but you also lose out on experience and networking. The longer you are absent from the workforce, the bigger the toll on your lifetime earnings. Women disproportionately bear the brunt of lost income and career progression because they are most likely to take time away from their jobs to care for other people. 

Women have higher student loan balances and represent the majority of student loan borrowers

These are statistics that only recently came to my attention, but women actually owe more in student loans than men. 

There are likely two main drivers behind this. First, more women pursue post-secondary educations than men. Secondly, because women earn less than men in their careers, it is more difficult for them to pay off their student loans so we can reasonably expect them to carry larger balances and remain in debt longer. 

Women live longer than men

Women tend to live 5 to 8 years longer than men. There is a myriad of reasons for this, but the result is ultimately that women will need to save more for retirement as they will live longer. 

“Gender-neutral” financial products and tax laws disproportionately favor men, because they have higher incomes and more wealth to benefit from them. Everything from low-fee investments to tax breaks on investment income disproportionately benefit men. It’s not meant to, but it does. 

You can’t fix something you don’t know is wrong

Most people think if they don’t “see” gender when discussing personal finance, they’re not being sexist. In fact, ignoring the impact of gender when it comes to income, debt, and wealth accumulation is fundamentally sexist. 

If we live in a patriarchal society where the default is male, attempting to ignore gender only further benefits men. We have to recognize and remedy the places in personal finance where women are underserved in order to achieve true equality. 

The solutions are uncomfortable and will make people (men) angry

In order to correct for a disparity, you have to provide advantages to the disadvantaged population. If you don’t acknowledge the unfair distribution of resources and opportunity, this will look like “just giving people money”.

This would, in fact, make things fairer. However, when you’ve been part of the privileged population for your lifetime, any step towards equality will seem like oppression. Sit down, boys.

Women should pay lower income taxes than men

We spend a lot of time focusing on fixing the gender pay gap in the workforce, as we should. However, an easy stop-gap to fix the net outcome — how much money actually ends up in a woman’s bank account — would be to reduce income taxes for women. 

If women paid lower income taxes, their net pay would be higher. This would largely reduce the impact of the gender pay gap directly where it’s felt: in your pocket. Increasing the net income women receive from their work would provide them with more income to save and invest, as well as pay off debt. 

Feminine hygiene products should be free in all public washrooms

Pads and tampons are necessary personal hygiene products, just like toilet paper. However, public washrooms typically only provide toilet paper. If pads and tampons are available in public washrooms, it is often only for a fee. 

Withholding toiletries menstruating women need in public bathrooms penalizes women for a natural biological function, and increases the financial burden of simply existing in a world designed for men. It’s ridiculous and needs to stop. 

Eliminate the “pink tax” on goods and services

Women pay more for clothing, spa services, and personal hygiene products. This is often referred to as the “pink tax”. This term was coined when comparing identical products, like razors or pens, and seeing those for women were simply colored pink and multiples more expensive. 

The cost of a haircut should be based on the length of hair. Since men traditionally have shorter hair than women, they’ll probably still end up with a discount but at least it will actually be rooted in labor and not sexism.

Abortion should be affordable (free) and accessible everywhere

It might seem out of place to bring up abortion when talking about personal finance, but the truth is there is no single thing that impacts a woman’s personal finances more than whether or not she has children. In fact, the single greatest predictor as to whether or not a woman will file for bankruptcy is motherhood. 

Limiting and restricting access to abortion forces women into motherhood when they do not feel physically, emotionally, or financially ready. Forcing a woman to carry an unwanted pregnancy forever compromises her financial security. It is singlehandedly the largest determining force of her lifetime financial health. 

Many pro-life advocates try to insist that adoption is a solution, but it’s not. Pregnancy is a tremendous physical undertaking that undermines a woman’s ability to work with exhaustion, sickness, possible bed rest, medical conditions such as gestational diabetes and more. There is also extreme discrimination against pregnant women in the workforce, which means simply being pregnant can prevent a woman from securing employment or receiving a promotion. 

When you restrict abortion you restrict a woman’s ability to earn a livelihood. There’s no equality in that. 

Childcare should be affordable (free) and accessible everywhere

If a woman does want to be a mother, it should not be at the price of her economic security. We need to make childcare free and accessible to women, so they can rejoin the workforce with the least interruption to their careers. 

Expensive childcare disproportionately penalizes women, particularly the most vulnerable: single mothers. With their income already lower than a man’s, piling on the expense of a daycare payment that’s equal to a rent or mortgage payment forces lone-parent families into poverty. 

If your response to this is that women should simply “plan better”, all you’re really saying is women should design their lives in a way to be economically dependent on men. We have created a world where single women with children cannot succeed (but single men with children can). It’s hard to create a society less equal than this. 

Your financial feminism reading list

Obviously none of the above will come to pass any time soon, but it is important to be aware of what could help equalize the playing field when it comes to personal finance. 

Interested in this topic and want to learn more? Check out the following books:

Keep advocating for gender equality in all spaces, but especially money!

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About Author

Student debt killer, super saver, and stock market addict. BSc. in Chemistry from the University of Alberta, MBA in Finance from the University of Calgary. CEO x 2 and MOM x 1. Currently residing in Calgary, Alberta, Canada, but hooked on travelling.

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