Why Financial Education and Confidence Matter for Women 

October 28, 2024 marked the 50th anniversary of the Equal Credit Opportunity Act, which outlawed discrimination in access to credit on the basis of sex. Despite great strides in women’s access to financial resources in recent decades, an equity gap still persists – equity in financial education, representation in the industry, and effective planning for women.  

As more women step into roles as primary financial decision-makers in their households, the need for financial education and empowerment is greater than ever. Over the past five years, the number of married women taking the lead on household finances has surged by 30%, with women now managing one-third of total U.S. household financial assets.² Yet, despite these milestones, women still face unique financial challenges that underscore the importance of confidence and education in financial planning.  

The Challenges Women Face in Financial Planning and Investing  

Despite their growing role in financial management, women encounter specific challenges that can affect their long-term financial security:  

1. The Investment Gap: Women contribute 30% less to their retirement accounts than men, partly due to the pay gap and career breaks.¹³ Yet, women who do invest tend to outperform their male counterparts by adopting a disciplined, long-term approach. They trade 27% less than men but often utilize a buy-and-hold strategy that helps secure more consistent returns.⁸  
2. The Pay Gap: The pay disparity still exists, with women earning 82% of what men earn, a figure that has remained stagnant since 2002.³ This gap affects every aspect of a woman's financial journey, from starting salaries to peak earning potential, which is capped $35,000 lower on average than men’s. Over a 40-year career, a woman can expect to earn $407,760 less than a man in the same role, impacting retirement savings and lifetime financial security.⁴  
3. Social Security Disparity: As a result of the pay gap, women receive 20% less in Social Security benefits compared to men.¹³ This difference can significantly affect women, particularly in their later years when they are likely to rely on this income for support.  
4. Career Breaks for Caregiving: Women are far more likely to take career breaks, with caregiving being the top reason.¹⁴ These breaks affect women’s earning potential, retirement contributions, and Social Security benefits, and they create unique needs for tailored financial planning.  
5. Longer Life Expectancy: In the U.S., women tend to live five years longer than men. In opposite-sex marriages, women also often marry slightly older partners, meaning they could live up to seven years alone after a partner's passing.² Women’s longer lifespans necessitate additional financial planning to cover healthcare and living expenses in later years.  

Why Financial Education and Confidence Matter for Women  

Building confidence in financial decision-making is crucial, as studies show only 25% of affluent women feel comfortable managing investments, compared to 40% of men. Half of female decision-makers feel unprepared to reach their financial goals, even when working with financial advisors.² Addressing these feelings of insecurity is critical, as people with a financial plan are 3.7 times more likely to feel confident about reaching their goals.⁶ Financial confidence can inspire proactive investment choices, which are essential to securing a stable future.  

Increasing women’s financial confidence is also about creating a positive impact on families and communities. Studies show that women make or influence 85% of affluent household charitable giving decisions, and companies with higher female representation often see greater financial performance.^{10, 11} When women are empowered with financial knowledge and confidence, they don’t just benefit themselves—they drive economic growth and contribute to a more equitable society.  

Steps Toward Financial Empowerment  

Curi RMB Capital believes in the importance of empowering women to navigate their unique financial journeys. In the year to come, we especially look forward to providing educational resources tailored to the challenges women face and encourage a collaborative approach to financial planning. This focus on partnership fosters an environment where our clients can feel supported in making informed decisions, building confidence with each financial milestone. I hope you’ll join us on this journey and expand your own knowledge base, while also helping us spread financial education to the women and others in your life.