Excerpt taken from Girls Just Wanna Have Funds - Written by Anna-Sophie Hartvigsen, Emma Due Bitz and Camilla Falkenberg
“Women” are not a homogenous group, and different categories of people have different experiences. As formulated by Kimberlé Crenshaw, an American law professor and the woman who coined the term intersectional feminism: “all inequality is not created equal.” Simply put, this means that different types of discrimination, such as gender, race, class and sexuality, overlap, creating compounding experiences of discrimination.
We can’t talk about one without recognizing the existence and impact of others. For example, Black, Asian and minority ethnic women experience sexism differently from white women in a society that affords privilege to whiteness. Trans women don’t have the privilege of cis-gender women; people with disabilities are not enabled to participate in work to the same extent as able-bodied citizens; migrants are often excluded from the very financial systems that we want to help you understand.
Understanding the historical context of gender inequality
Therefore, looking at the current state of financial inequality isn’t enough to change attitudes. We also need to recognise the historical context of the issue. Decades of systemic discrimination have created deep inequities that disadvantage some people in society from the very beginning, and this extends across generations. This is especially important when we’re talking about money, as we know that women have historically been excluded from earning, saving and managing it – especially women and girls of colour.
Another factor that significantly impacts your relationship with money is your current life situation. Do you have a job? Are you in a relationship? How is your health? How is your financial health? We all have different starting points when it comes to investing, which is why we encourage everyone to embark on investing with their own experience in mind.
The current state of financial inequality
When it comes to money, we like to think that men and women will receive the same opportunities if they put in the same amount of work and dedication. But the uncomfortable truth is that women face a large number of discriminatory barriers, some of which are so deeply ingrained in society that many are blind to them or even deny their existence. For starters, women earn less than men – even when they are doing the same jobs. In developed countries, women in higher education outnumber men. They achieve better academic results and make better leaders once they enter the workforce. However, they still earn less, are poorly represented in politics, and are less likely to join the top ranks in business or become entrepreneurs.
The gender wage gap
The wage gap, combined with factors such as women being more likely to live longer and more likely to take a career break or choose part-time work, can have a major impact on a woman’s financial situation over her lifetime. For example, a 10% pay gap alone can lead to approximately 38% less wealth by the age of 65. Could women change this themselves? Probably not, because even when women ask for a raise, they are less likely to get it and more likely to be viewed as greedy and demanding.
These facts refer to women who are in paid work. But globally, 42% of women aren’t in the paid workforce because they are doing unpaid, largely invisible work at home. Does this work have value? Very much so. In fact, a study into unpaid labour conducted by PwC found that, in the US alone, the value of the unpaid economy was $565 billion – worth around a third of the entire economy – and the vast majority of this is attributed to childcare. So this concerns the gender pay gap, but we also have to consider the gender wealth gap.
"Girls and women are being excluded from learning, earning, saving and investing. Our mission is to change that"
The gender wealth gap
While the pay gap refers to compensation, the wealth gap is the overall difference in net worth between men and women, which is affected by a lot of things besides pay. The systemic barriers for women go far beyond the job market. For example, women have more student loans, are denied mortgages more frequently and when they are granted loans they are charged higher interest rates on them. They also pay more for housing investments and receive lower-quality financial advice.
Research finds that women are much more likely to be advised to save, whereas men are advised to invest. And according to the World Economic Forum, these inequalities start early – studies show that young girls consistently get less pocket money than young boys and are expected to do more chores around the home. Throughout our lives, these stereotypes around women and money are reinforced by the education system, by financial institutions, and even in relationships – parents are more likely to teach their daughters about the importance of saving while educating their sons about building wealth. At every step of our lives, from our earliest days, girls and women are being excluded from learning, earning, saving and investing. Our mission is to change that.
The gender investment gap
This depressing news continues, because when it comes to investing, women are falling behind here too. Female investors are still a minority, and in the financial industry, women are a rare sight in executive positions. The fact that women are underrepresented in financial markets inevitably raises the question: “Are men better investors?” The answer to this is a clear-cut “no”. That’s not just our experience from running one of the world’s largest investment communities for women – we are backed up on this by several studies that have concluded that women investing in stocks are better at it than men. So that’s what Female Invest is all about. We’re going to help women to get onto the investment ladder and take control of their financial future. We’ve got this – we’ve just got to get started.
Three major questions we’re asked about financial inequality
Are women less qualified?
No – in fact, the opposite is true. Women in developed countries are more educated than men, but they don’t receive the same financial remuneration or status for the work they do. And yet, when it comes to investing, women in developed countries achieve better financial returns when they do invest.
Are things improving?
Not significantly. Even though we are talking more about the topic than ever before, progress in this area has ground to a near halt. Globally, women’s participation in the workforce has stagnated for two decades, while women’s income share hasn’t changed much in the past 30 years.
Have we acknowledged the problem?
In the US, only 12% of men think women have fewer opportunities for advancing in their career. In Europe the numbers are similar, with more than one-third of Europeans believing that men are more ambitious than women, and almost seven in 10 respondents thinking women are more likely than men to make decisions based on their emotions.