Three Things Women Need to Know About Money

Higher education has long been considered a passport to a good job and financial stability. Women now make up a majority of the college-educated workforce. In fact, women have outnumbered men in terms of completing college degrees for over 40 years.

If we’re so smart, why aren’t we rich? Here are three reasons, and what we can do to address some of the challenges women face as they build wealth.

The Gender Wage Gap

Despite passage of the Equal Pay Act over 60 years ago, the gender wage gap persists—women’s wages relative to men’s have stagnated for the last two decades. In 2025, women working full-time, year-round earn about 81 cents for every dollar earned by men, and when all workers are included (full-time, part-time, and seasonal), women earn just 76 cents to the dollar. The gap is even larger for women of color: Black women earn about 65 cents, and Latinas about 58 cents, for every dollar earned by white, non-Hispanic men. Over the course of a woman’s career, this can add up to anywhere from $500,000 to $1,200,000 in lost earnings.​

Unpaid Caregiving

Women may take time out of the workforce to provide care for children and aging relatives, and sometimes for an older spouse as well. Care work includes not only caring for children and older family members, but also the work that goes into maintaining a household—all the shopping, cleaning, meal prep, and laundry that women still spend about 30% more time doing compared to men. This unpaid work powers the paid economy. If women were paid minimum wage for performing care work, it would add over $1.5 trillion dollars to the U.S. economy annually. Unpaid care work not only results in lost income, it also means that women do not contribute to Social Security when taking time out of the workforce.​

The Retirement Gap

These two gaps combine to make it more challenging for women to be financially prepared for retirement. Women have a longer life expectancy—about 2.5 years longer than men—which means they need to have an even bigger nest egg upon retirement. But being paid less makes it harder for women to save toward their financial goals, including retirement. Taking time out of the paid workforce means women are not paying into Social Security, and combined with the gender wage gap, results in women receiving a lower monthly benefit at retirement. As of 2025, the average monthly Social Security benefit for a retired man is $2,030, while the average for a retired woman is $1,650. Women on average live longer compared to men, with higher costs for medical care. All these factors interact such that women are almost twice as likely to live in poverty in their old age compared to men.​

What We Can Do as Individuals

Problems such as the persistence of the gender wage gap and the lack of paid family leave policies are larger systemic issues that will require large-scale policy-level solutions. So what can we as individuals do to navigate these challenges to our financial well-being in the meantime?

• Navigating the wage gap: The good news is that it’s becoming more common for companies to include salary ranges as part of a job description when advertising for applicants. Many states and major cities have also outlawed the practice of requiring applicants to disclose their previous salary, which has historically contributed to women remaining underpaid. It’s important to know your worth. When applying for a new position, research salary ranges for the job title, experience level, and geographic location through sites such as Glassdoor and Salary.com. Be prepared to negotiate, but be aware that it’s trickier for women. This guide from The New York Times can help.
• Unpaid caregiving: If possible, delay claiming your Social Security benefit as long as you can unless you have another reason to claim earlier than age 70. While you can claim benefits starting at age 62, every year you delay your claim past your full retirement age increases the annual amount by about 8%—a return that’s better than most investments. Proposals to address the continued sustainability of Social Security and Medicare are likely to be put before Congress in the next few years, so sharing your concerns and needs with your elected representatives will be even more important.

The retirement gap: Contribute to a workplace 401(k) if you can, and if your employer offers a match, contribute enough to get it. Consider investing outside your 401(k) if you can, especially in a Roth IRA which can provide tax-free income during retirement. And as high-deductible health plans (HDHPs) have become more common, more people are eligible to contribute to health savings accounts (HSAs). HSAs are triple tax-advantaged, are not tied to your employer, and money you contribute rolls over year to year and can be invested. HSAs can be another way to cover health care costs in retirement with tax-free money.

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Articles Cited

• Equal Rights Advocates: New Census Bureau Numbers Shed Light on Worsening Pay Gaps
• CNBC: For the First Time in Over 60 Years, the Gender Pay Gap Widened 2 Years in a Row
• Novoresume: The Gender Wage Gap - All You Need to Know in 2025
• Forbes: Stay-At-Home Parents Do Roughly $4,500 Worth Of Work Per Month