Why women suffer more from financial stress
Recent studies have found women feeling considerably more financially stressed than men – but why?
In the United States, a recent study of 10,500 employeesby Salary Finance, found more than half of women born between 1981 and 1996 (millennials) are worried about not having enough to retire. In comparison a third of millennial men have the same beliefs.
The study found similar disparities between men and women in Generation X: 44.8 percent of women born between 1965 and 1980 are worried about money issues most or all of the time, while 36.1 percent of men feel the same.
In Australia, NAB’s Australian Wellbeing reportshowed financial anxiety rose, probably due to coronavirus, in 2020. Women were more worried than men.
According to the research women were more worried than men about raising money in a hurry for an emergency, children’s education and rent or mortgage costs.
The most fearful group of all were women over 65.
It’s been happening for years. Back in 2014, the Australian Psychological Society 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.
AMP’s study found the main financial stressors in people’s lives are (in this order), bad debts, home loans, retirement, supporting the family and budgeting.
In the United States, Californian company Financial Finesse found 55 per cent of mothers earning less than US$60,000 reported “high” or “overwhelming” levels of financial stress. Male parents of a similar age group and income level were 40 per cent less likely to feel as bad.
While there are often only small discrepancies between men and women around financial values and stressors, women almost always report more negative feelings about money, even if only marginally.
One explanation for women’s financial stress is historical and current pay inequity. On average Australian women in fulltime work earn 17.3 per cent less than men ($277.70) according to the Workplace Gender Equality Agency. That gap has “hovered between 15% and 19% for the past two decades”.
In the US, the difference is starker: women on average are paid a third less.
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, generally speaking, 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, or learning budgeting skills, 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.