Why Is It So Hard For Women To Hold On To Their Money?

This article was contributed to us by Deborah Tan-Pink, Head of Communications & PR at Revolut Singapore

While the gender pay gap is about compensation, the gender wealth gap is the difference in overall net worth between men and women. Worldwide, men own 50% more wealth than women, and taken together, the wealth of the richest 22 men in the world equals all of the wealth of the women in Africa.

Around the world, women are losing out financially — not because we are “shopaholics” or “bad with money” but because we are frequently expected to take on unpaid care work. Oxfam believes that the total value to the economy of women’s unpaid care work is at least US$10.8 trillion a year, three times larger than the value of the global tech industry.

Unpaid care work isn’t just about not paying women for the time and effort they put towards their families, it’s also about the opportunities they miss out on at work due to unconscious bias and discrimination arising from their bosses’ perception of them.

The Cost Of Putting Family First 

When women take on care work, the assumption is that they are doing this out of love, and how could anyone possibly measure that with money? The pandemic has further put women in a double bind. More women than men have lost their jobs during this time and, due to a cut in household expenses, have been expected to give up their time at work to pick up kids, meet the teachers, and run the household.

While companies may say they are introducing flexible work arrangements to help employees balance their professional and home lives, we cannot deny that women are more likely to be pigeon-holed if managers believe them to be “homely”. They end up losing high-profile assignments to other colleagues, and ultimately that promotion.

So, not only do women start with lower salaries than men, we miss out on getting more pay increments and benefits over the course of our working lives from getting passed over for promotions. How can we even grow our wealth when we have so little to begin with?

Werk It

The fact that women spend more time doing unpaid work than men make it all the more important for us to find ways to make our money work harder. Equitable access to financial services is an important first step and encouraging women to use those provided by fintechs like Revolut can improve our financial outcomes.

Fintechs often provide products and solutions at lower fees. However, the World Bank found that women are more worried about privacy and security, and thus less likely than men to use fintech products. This then translates into a further loss of wealth as they may end up paying more in hidden fees and getting less for their money.

To foster better financial inclusion, technology alone cannot close the wealth gap between men and women. Fintechs need to introduce initiatives that take into account differences in attitudes and encourage initiatives that fit the needs of all.

Here are some ways the Revolut app works to empower women customers financially:

1. No hidden fees
   Whether a customer is exchanging currencies or investing with one of Revolut’s Wealth products, they will always be told upfront what they are being charged in fees.
2. No fall-below fee
   Customers will not have to pay a fall-below fee, something that many incumbent banks typically charge when a customer’s bank account balance falls below a stipulated minimum daily balance. This is helpful for women who may use their accounts to pay for large upfront expenses such as school fees and household expenses, and are therefore more likely to dip below this minimum balance.
3. Split bills and request for money easily
   For customers who find themselves footing the bill first, Revolut has a feature that helps them split the bill and request for money from their contacts. For women who may manage shared expenses with their partners, this automates and transparently monitors the process of sharing costs.
4. Plan and stick to budgets
   Determine how much we would like to spend every month, and on what. The Revolut app tracks our spending and lets us know whether we’ve overspent or are on track.
5. Round up spare change and save them as fiat currencies or precious metals
   For women who find it challenging to build up their investment portfolio, Revolut enables rounding up spare change which can be saved either in a fiat currency of choice, or in gold/silver exposure.

Gender Wealth Gap Needs To Be Transformed

While access to fintech services will not bridge the gender wealth gap overnight, helping women change how they manage their money is a step in the right direction.

Ultimately, the economic imbalance between men and women needs to be addressed in bigger, more impactful ways through policy designs and institutional changes. These include reducing the amount of time women spend on unpaid care work with benefits such as free or subsidised childcare at the workplace, medical and dental insurance for employees and their immediate family members, holding employers accountable for any biases that may exist, speaking to local legislators about tax or income laws that may have blindsided unemployed women, mothers, widows, or single women.

Narrowing the gender pay and wealth gaps is not a zero-sum game where men stand to lose when women benefit. A 2018 McKinsey report on diversity shared that increased gender diversity improves a company’s profitability by 21%. With two-third of women saying they get stressed about money at least once a week, it makes sense that employers do all they can to alleviate the stress and drive positive change. What is good for women is ultimately good for business.

Find out more about Revolut at www.revolut.com.

If you are interested, you can sign up for the Revolut card here. Enjoy $0 Monthly Fee, $0 ATM fee, no hidden fees for currency conversion with the standard account