Did you know that Oct. 11 was the International Day of the Girl Child? Designated an official international day by the United Nations, its goal is to focus attention on the particular challenges girls face worldwide, encourage programs that empower girls and celebrate the achievements of girls.
So what does this have to do with finances? Well, to me, it brings to mind the challenges women and girls face when it comes to money right here in the United States. In spite of advances in many areas, girls often don’t get the same financial start as boys. And, frequently, that disparity begins at home. It’s certainly not intentional, but it’s a continuing concern and has ongoing repercussions as girls become adults. The good news is that with a little more awareness, parents can help turn this around.
I get many questions from parents concerned about the lack of financial education in our schools. And as you may know, I’m a big champion of helping teachers include financial literacy in their curriculum. But I’m also a firm believer that we as parents can take concrete steps to help all of our kids — regardless of gender — get on the right financial track.
Here are some ideas on how to do this:
1) Talk equally to your daughters and sons about money. Our studies show that parents are more likely to talk to girls about short-term concepts like budgeting and to boys about long-term planning and investing. We need to change that by making sure we have the same money conversations with our daughters and sons — whether it’s about paying for groceries or investing for retirement.
2) Make money talk a part of everyday life. Whether you’re saving for a major goal or deciding on a purchase, share that process with your children. For instance, taking a trip to the store? Even a young child, male or female, can learn to handle money, comparison shop and choose between a need and a want. Planning a family vacation? Get everyone involved in a cost analysis and savings plan. Discussing money openly — and making sure not to divide topics by gender — can set your kids up to make informed financial decisions later in life.
3) Make equal pay for equal work a rule at home. Out in the real world, women still only earn about 80 cents to a man’s dollar. Unequal pay starts earlier than you might think. Research shows girls sometimes get paid less than boys for household chores. Be sure not to divide chores by gender (i.e., girls clean the kitchen, boys mow the lawn). Also have a conversation about the value of different types of jobs — and knowing your own value when it comes to negotiating a salary.
4) Encourage financial responsibility early on. Once your kids have money of their own, they need to learn how to manage it. Whether that money is from an allowance, gifts or a job, help them set goals to spend and save responsibly. Open a savings account or even an investment account for them so they get hands-on experience.
5) Talk honestly about the obstacles women face. Even before your daughter enters the workforce, talk to her about the wage gap and potential inequalities. Encourage her to research salaries and to be her own advocate when presenting her skills and expectations to employers. With women generally living longer but earning less and being in the workforce for fewer years, it’s critical that they save and invest for their future, especially when it comes to retirement.
6) Finally, set a good example. Kids learn as much by what we do as by what we say. The example you set sends a powerful message about gender roles around money. Are Mom and Dad equally involved in the household finances? Or does Mom pay the bills and Dad worry about investing? The kids will notice.
A recent Schwab study underscores the differences in financial attitudes between young males and females, but there’s one significant thing they have in common: Parents are their most trusted source of financial information. To me, that’s pretty encouraging. And the most important lesson you can teach them is that regardless of gender, they have the capability — and the responsibility — to understand and control their finances. If you can do that, you’ll be providing all your kids with the tools they need to thrive.•
Carrie Schwab-Pomerantz, Certified Financial Planner, is president of the Charles Schwab Foundation and author of “The Charles Schwab Guide to Finances After Fifty.” You can email Carrie at email@example.com. Opinions expressed are those of the author.
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