Even though women make up the majority of college graduates and are increasingly making strides in the workforce, there is still a significant and growing gender gap when it comes to financial wellness. Women lag men in many areas of financial planning, and they are significantly behind in two of the most critical areas—basic money management, which is the foundation for financial planning, and investing, which is a necessary skill to grow wealth over time.
Below are key trends around the gender gap in financial planning and financial literacy:
- Overall, the gender gap is widening, with women falling further behind in many key areas of financial planning, most notably money management and investing.
- Women’s confidence in their retirement preparedness has slipped and they are still behind men in terms of how much they are saving for retirement, but the gender gap in retirement planning is smaller than most other areas, with virtually no gap between men and women with respect to participating in 401(k) plans or IRAs.
- In general, women are doing a better job at planning for longer term goals and protecting their wealth, but having a harder time with basic money management skills and investing, both of which are more transactional in nature and often entail more hands-on management and quick decision making.