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Most of us know that pay gaps between women and men stubbornly remain in place throughout the nation’s workplaces, and that misleading myths about how women handle money persist. We also know that women continue to push for equal pay in their fields and increasingly reject narratives that contend women aren’t good with finances. However, what you might not know is that the groundwork for inequalities in how women and men earn and regard money is often laid during childhood.
Several studies reveal jarring differences in the ways parents educate their children about money. And the messages those differences send to our daughters may have a lasting impact on their expectations and perceptions about earning, saving and investing as adults.
What the Data Says
Data in these studies show girls often receive less money from their parents, via allowances or gifts, than their male siblings. Additionally, boys are introduced to wealth-building topics, such as credit and investing, earlier and more frequently than girls — and those topics are usually broached by fathers. In contrast, budgeting and spending habits, which emphasize fiscal restraint, are the dominant themes of parents’ fiscal conversations with girls — with mothers more often leading those interactions.
This data reflect a bigger reality: Women tend to take others into account when considering financial matters, while men have a more individualized decision-making process. Additional discrepancies that result from how men and women learn to prioritize, view and manage finances — as well as the ways they learn (or don’t) to talk about money — may result in women developing more cautious and hesitant approaches to their financial lives.
What Should Parents Do?
Both mothers and fathers should make it a priority to raise their daughters to be financially confident individuals. Experts encourage parents to involve children early and often in lessons and discussions about money. U.S. News & World Report’s Coryanne Hicks provides the following tips for parents who are determined to empower their daughter’s financial futures:
- Set the example and model money equality at home.
- Introduce sound money-management behaviors early in your daughter’s life.
- Be proactive about discussing your actions and thought processes regarding money.
- Be open and honest about your own insecurities when it comes to financial matters.
- Give your sons and daughters equal allowances and chore responsibilities.
In all likelihood, if you parent a daughter, you aim to serve as a positive role model for her in multiple ways as she moves toward adulthood. This means you can also exhibit behaviors that provide a valuable, positive perspective on a woman’s ability to determine her financial future:
- Share lessons about the value of work and the ability to earn a living. Commit to ensuring your daughter believes she does not deserve “less than” when it comes to her earnings and investments.
- Communicate your financial priorities, outlook and management style. Let your daughter know decisions about money do not follow a single formula.
- Clarify the distinctions between wants and needs — and discuss how spending and saving behaviors can support healthy, lifelong financial habits.
- Gain self-awareness of the ways you verbalize your thoughts and views about money and finances (or lack thereof). Our attitudes toward various subjects inform our children’s behaviors and attitudes. If you want them to be financially confident, show them what that looks like.
Women continue to make strides in their personal and professional lives. At The Humphreys Group, our knowledgeable, experienced advisors are committed to providing resources that help our clients advance in their financial lives, with all the confidence, intellect and ability we know they possess. Contact us to discuss how we can work with you — and influence the next generation of financially savvy women together.