Addressing the Financial Literacy Gender Gap
According to new research from George Washington University, women around the globe lag behind men in financial literacy. One of the key challenges facing financial literacy organizations and educators today is “bridging the gaps” – gaps found along gender, educational, and generational lines.
As a result of these disparities, certain demographic groups lack access to high-quality basic financial information. Establishing a baseline illustrating where gaps exist and then finding solutions to address those gaps will ensure that important vulnerable segments of the population have access to better information.
New research shows that women in many countries
need access to basic financial literacy training.
What Is The Gender Gap in Financial Literacy?
Studies show that, on average, women are less financially literate than men. A wide range of factors contribute to this disparity; but whatever the cause, women suffer as a result. They are less prepared to take critical steps like saving for retirement, buying a house, or thriving in the aftermath of divorce. Without access to basic information, it’s hard to be an equal partner within a relationship or effectively manage one’s own financial details.
What’s more, many victims of the financial literacy gender gap may be ashamed that they lack education. As a result, they may be reluctant to seek help or educational resources.
Here’s a closer look at several strategies to address the financial literacy gender gap.
Create A Welcoming, Non-Judgmental Environment
Discussing money is always potentially challenging. People carry a wide range of attitudes, mindsets, and notions that affect how they think about financial issues. Because the subject of money is emotionally charged, individuals struggle to overcome obstacles. Being aware of the emotions behind financial decisions is particularly important when launching initiatives to address gender gaps.
Strive to create a welcoming, non-judgmental environment that focuses on quantifying current financial capability levels and then setting clear goals to help people achieve their objectives. Emphasize that everyone needs to learn this information. Stress that it’s always possible to learn, despite one’s age or background.
Discuss The Gender Gap
Raising awareness is another important component of addressing the financial literacy gender gap. Whether you’re talking with parents about the importance of educating all children, or acknowledging that many older women never had the advantage of such training, raising awareness is an essential process element.
As awareness builds, individuals are likely to seek out the training they need. Organizations that work with affected populations are reminded to include financial training in their programming. The National Financial Educators Council suggests using educational promotions to raise awareness, which helps increase the reach and frequency of financial literacy education.
Community organizations are the frontline of
the financial literacy movement.
How The Gender Gap Can Be Overcome
Addressing the gender gap in financial literacy needs to begin early, by ensuring that all children receive ongoing financial literacy training throughout their lifecycle. It’s also important that training in young adulthood helps young women prepare for their financial lives – from handling college loans to placing the building blocks of a solid financial future. Investing effort in training young women will pay off in dividends and reduce the gap over time.
Financial organizations in the community – banks, credit unions, and insurance agents – are well-placed to provide financial literacy training. As they establish trust and relationships in the community their on-staff educators can open discussions and offer much-needed training to clients, reaching populations that might otherwise be reluctant to participate.
Programs like the LiSA Initiative are an excellent starting point for people who seek to gain confidence in making financial decisions.
Financial literacy is a concern for the entire population. But over time, paying attention to specific populations in need of greater knowledge and support can help reduce disparities in financial capability that result from lack of access to education and resources.