In honour of International Women’s Day and Women’s History Month 2022, Untangle Money is proud to be #breakingthebias by supporting women in their financial journey. We are dedicated to continuing to amplify the conversation around women and finance. That is why today we are discussing the biases that exist against women in the world of finance.
Important to note: In this post we are specifically talking about gender bias and how it impacts the financial lives of women. With that being said, we understand that there are other biases that exist that impact the financial lives of people because of their race, sexual orientation, because they are non-binary, and many other unjust reasons. It is always important to acknowledge intersectionality and how that plays a role in the financial sphere.
Let’s dive right into it!
What is bias?
This is a common word that we’re sure you already know, but it’s important to define it so there’s no confusion.
According to dictionary.com, ‘bias’ is: a particular tendency, trend, inclination, feeling, or opinion, especially one that is preconceived or unreasoned; and unreasonably hostile feelings or opinions about a social group; prejudice.
So what is ‘gender bias’?
Gender bias is behavior that shows favoritism toward one gender over another. Most common, gender bias is the act of favoring men and/or boys over women and/or girls.* Gender biases tilt the playing field against women making things harder than they should be.
*It should be noted that one, this is not always the case; and two, under an intersectional lens, the issue becomes a lot more complex (for example, racial bias also coexists with gender bias; as well as the fact that gender is a spectrum and there are people who are non-binary that also face bias).
What are some gender biases that women encounter?
Women are no stranger to a host of different biases in all aspects of our lives that stem from being a woman. If you haven’t encountered gender bias yourself, you probably know someone else who has. For decades, if not centuries, women have had to contend with these biases, which is why this year’s International Women’s Day theme of #breakthebias is super relevant.
Let’s start within the workforce! It’s no surprise that women have to put up with biases in the workforce that make it harder to climb the ladder, past that good ol’ glass ceiling. For example, women who are assertive (like men are), are “too bossy”; not to mention being too competitive and/or ambitious are also seen as negative and unlikeable traits for women. But, when women conform to their traditional feminine traits, they’re not taken seriously, especially in higher-ranking (*coughs* and higher paying *coughs*) roles.
Another example of gender bias in the workforce is in the hiring process. Before they’re even in a role, women experience gender bias just trying to get the role. One of the most common biases is that it is assumed that all women will at some point have a child (despite this being not true for all women), and that makes women unhireable in the eyes of a lot of employers. Whereas men who want, have, or are expecting, kids, do not face any “consequences” for that. Men aren’t ever asked in a negative sense, if they are planning on having kids, but this is a common question women get asked and then have used against them.
Gender bias against women in the financial sphere.
According to Forbes, a new study revealed that financial advisors are still stuck in the patriarchal past, conforming to the stereotype that men are in charge when it comes to finances. However, a study done by Merrill Lynch Wealth Management shows that 65% of women under the age of 45 are the primary financial decision makers in their households. Despite many women clearly being in charge of their household finances, when a heterosexual couple meet with a financial advisor, it’s still assumed that the man is in charge of the money.*
*Two things to note from this study: One, some of the financial advisors were unaware or unconscious of these biases towards women. Two, some of these financial advisors were women - this touches on a larger issue of 'internalized misogyny' which we'll save for another day!
Gender bias in the financial sphere also stems from the reality that men (especially cis-white men) are the default gender/sex that most things are structured around. As a result, the financial lives of women are often ignored. Women's financial lives include far more ups and downs. Factors like the Pink Tax, the Wealth Gap, the Wage Gap, maternity leaves and women's career trajectories all impact women's financial lives; factors that don't really impact men's financial lives. So, the typical "traditional finance" model doesn't necessarily work for women; but it's assumed that if it works for men, it works for everybody.
Some other quick notes about gender biases related to finance:
Men are taught to invest to save money and build wealth; women are told to cut back on shopping and buying coffee
There is an implicit bias that women are not good at investing as men, yet the converse is actually true. Study after study shows that when women invest, they obtain better performance than men do
Retirement planning is also male-focused, not taking into account that women, on average, live longer than men and therefore need to save more money
Women business owners face greater barriers when it comes to accessing financing and are also more likely to be rejected/receive less funding than men
Women receive lower credit scores, despite the understanding that women are better at repaying borrowed money, which indicates that something in the credit scoring system is biased against women's lives.
Which ones have you experienced? Are there some we haven't included? Let us know!
As is our purpose here at Untangle Money, it is important that we continue to have conversations about how women and other minority groups are disproportionately impacted by the patriarchal structures in place - specifically in the world of finance. In order to #breakthebias we must continue to educate ourselves and others on the different financial lives of women, women of colour, and non-binary people. Only then can we dismantle those very structures and lead everyone toward financial success.
What’s Next?
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Financial independence is a huge part of being a strong, independent person, and it is our mission to help women, and anyone who doesn't feel safe or welcome in financial spaces typically dominated by cis men, set themselves up for financial success.
At Untangle Money we help women understand their (real!) financial picture, and obtain financial guidance from people that actually, really, get it; this is why we offer affordable options so that we are accessible to everyone. We would love to help you, too! Join the community of hundreds of other women looking to strengthen their financial well-being. You can check out our products and plans here or get in touch for a free consultation!