Why women suffer more financial stress
Recent studies have found women feeling considerably more financially stressed than men – but why?
In the United States, a May 2022 study of 2,456 adults by Bankrate, found women are more likely to be negatively affected than men. Women are significantly more likely to cite money as having a negative impact on their mental health, with 46 percent selecting it compared to 38 percent of men.
Among those who said money negatively impacts their mental health, women are more concerned than men about having enough emergency savings and paying for everyday expenses (at a respective 60 percent and 59 percent, versus 53 percent each for men).
Common financial situations are also more likely to trigger negative emotions for women than men, such as checking one’s bank account (52 percent of women versus 46 percent of men) or facing unexpected expenses (73 percent of women compared with 64 percent of men).
The study also found women are more upset by events such as an unplanned expenses, when bills are due, and when bills are paid.
More women (at 41 percent) said their mental health was negatively impacted by fears of being unprepared for retirement than men (at 36 percent).
Also, the survey found that men (at 50 percent) were also significantly more likely than women (at 37 percent) to say they have stocks or stock-market related investments.
In Australia, NAB’s March 2022 (Q1) wellbeing survey found financial stress levels continue to be lower for men compared to women, and the gap has widened. Men reported slightly lower financial stress in Q1 (down 0.4 to 38.6), but it increased for women (up 1.0 to 42.6).
Women reported higher stress for all measures except credit card repayments. Relative to men, women reported much higher stress levels over home improvements and maintenance, raising $2,000 for an emergency, non-essentials, major household items, financing retirement, providing for their family’s future, and medical bills.
Overall debt stress among Australians women (40.5) reported higher debt stress than men (36.7). The number of Australian women who missed a bill or loan payment reported was 25% compared with men at 19%
It’s been happening for years. Back in 2014, the Australian Psychological Society (APS) reported “personal financial issues” were a major source of stress for 53 per cent of women but only 44 per cent of men.
The APS found three main causes of stress amongst Australians (in order) were personal finance, family issues and personal health.
One explanation for women’s financial stress is historical and current pay inequity
In Australia, according to the Workplace Gender Pay Gap Statistics (WGEA), Australia’s national gender pay gap is 13.8% as at February 2022. The national gender pay gap is calculated by WGEA using data from the Australian Bureau of Statistics (ABS).
The current male average weekly ordinary full-time earnings is $1,846 compared to $1,591 for females.
This means that on average, women earned $255 less than men.
In the US, their 15 March 2022 Equal Pay Day highlighted 83 cents: that’s how much women in the US who work year-round are paid for every one dollar paid to men.
That’s 15 months. Or, if you look at a typical 9:00 – 5:00 workday, women start working for free at 2:40 p.m. Over half a century after the US passed the Equal Pay Act, American women still face a substantial gender wage gap across the spectrum.
At the same time, women traditionally have had more responsibility for the day-to-day running of the home, such as domestic duties and childcare. In recent times though women’s involvement in financial decision-making – and sharing costs – in relationships has increased.
One could speculate shouldering more financial responsibility while still earning less and doing more than men at home might be a factor in women’s higher levels of financial stress. There is also evidence that risky behaviours with money, such as impulse spending, are linked to feelings of stress, guilt, boredom and anger.
The problem with financial stress is that it does not just impact our finances, it can have a significant effect on our wellbeing including our physical and mental health along with our relationships, work, behaviour and potentially our environment.
Seeking help around our finances and feelings of financial stress eventually becomes essential.
The help required will vary for individuals. It may be practical financial support, learning budgeting skills, increasing your financial literacy or seeking assistance to manage the stress of money worries.
One solution for some sufferers of financial stress is to become financially mindful.
Financial mindfulness, is an active process of paying attention to your finances, financial behaviours, attitudes, and beliefs around finances. It is keeping awareness of your thoughts, feelings, actions and financial environment in mind so that you can make better financial choices.