September’s Real Simple features an article on “Women and Money” and “Why you need to take control now.” Author Geraldine Sealey writes of putting off opening a 401k for a decade for…no good reason. “Like millions of other women, I was perfectly happy to pinch pennies and hunt down sales, yet I couldn’t muster the slightest interest in big-picture financial planning. What the heck is going on here?”
It’s a good — and important — question. While women have “more power and earning potential than ever before,” there’s still an income gap and a wealth gap. Why? Plenty of employment discrimination, to be sure, but I’m thrilled that Real Simple also chose to include two factors I identified in an interview with Sealey (and quoted me on them!): “We sweat the small stuff” and “We’re waiting for someone else to fix the problem.”
Regular readers of this blog know I sound like a broken record lamenting that first one. A recent Citi Economic Pulse survey found that 76 percent of women claim to regularly clip coupons. We see coupon-clipping as the female definition of being smart with a dollar. But why are we concerning ourselves with nickels and dimes instead of focusing on the big stuff, like maximizing income and investing for the future? As Eleanor Blayney of Directions for Women told Real Simple, “When they find themselves hitting up the sale racks, women need to remember that even the best deal they find is worth far less than a smart investment in their retirement fund.” (Even if you don’t plan to retire!).
As for that “maximizing income” idea, this gets at the second factor. As I told Real Simple, even many young women grew up “with the idea that they would be secondary earners.” We grow up with the idea that our income is expendable, that working for pay is a choice, and that we can cut back our hours or scale back our careers for a while if we need more work-life balance. This is all fine…if you assume that you will always have a husband or partner who can give your children the life they deserve. But what if, for whatever reason, the children’s standard of living someday rests on you? Which it does for, by some measures, a third of families now? If so, taking your foot off the gas for too long can mean reduced opportunities for them. This is one reason I tend to think that maintaining one’s earning capacity is part of mothering. Obviously, life happens and sometimes people have to take career breaks or slowdowns for a time. But even so, being financially savvy means maintaining professional certifications, keeping your hand in by attending networking events and taking on freelance projects on at least a quasi-regular basis.
Of course, there are some families in the 1% for whom the volume of assets means that, even in the event of a breadwinner’s death, disability or a divorce, everyone would come out OK. Should these women take their feet off the gas? If they want to, there’s less harm, certainly (unless the assets disappear; companies do go bankrupt, to list one disastrous option). But I dislike the way this issue is often phrased, that if a woman doesn’t have to work, that should answer the question. For starters, the volume of evidence is that children aren’t harmed by mom being employed. Striving toward professional goals is a major component of human happiness. Women who don’t “have” to work can have a lot to offer the broader world, not just in a volunteer capacity. Plus there’s always the question of what you model for your daughters who, in any event, aren’t going to marry dad.
In other news: I was going to write a Todd Akin post, but thought better of it.
I’m also in Real Simple this month with an article (p. 140) on how job seekers should manage their online presence.