March 17, 2021
From the gender pay gap to gender stereotypes, women face a variety of financial challenges. We look at how to overcome them here.
Women often face unique complexities as they attempt to achieve financial well-being. The gender pay gap, the role many take on as caregivers, and overall issues around their confidence with personal finance are all examples of why women may struggle financially more than men.
Understanding these issues is the first step toward finding solutions and achieving financial empowerment. We’ll look at how these issues affect women look and ways women can improve their overall financial well-being.
The gender pay gap is a well-known concept. It refers to a discrepancy in the average salary between men and women who do the same job.
Women earn about 84 cents for every dollar a man makes doing the same job, according to the most recent data from Statistics Canada in 2022.
This loss of pay can cost women thousands of dollars over the course of their careers.
For women of colour or from indigenous backgrounds who also face racial challenges, the pay gap can be even larger.
Some good news is that there is significant evidence that the gender pay gap has been shrinking in recent decades. In 2007, it was 15%, according to the same Statistics Canada data from 2022.
But the change has been very slow, and the gap is still a long way from disappearing completely.
Despite much progress being made on breaking down gender roles and stereotypes, women are still seen as the primary caregivers in many families.
“Nearly one third of women (32%) looked after or provided unpaid care to children, and almost one quarter (23%) provided unpaid care to adults with long-term conditions or disabilities. These proportions were higher than those of men, at 26% and 19%, respectively,” a Statistics Canada report on women as caregivers found in 2023.
Being a caregiver comes with all kinds of financial challenges and can lead some to fall into serious debt issues.
Maturn, a company that offers programs to help women transition to and from maternity leave, and The Brand is Female, a consulting agency that aims to foster better inclusion in the workplace, released a joint report in 2023 that focused on “the motherhood penalty”.
About three quarters of those surveyed for the report (70%) said they did not have enough support from employers as new parents. A further third of those surveyed considered leaving their jobs due to this inadequate support.
The Canadian Centre for Policy Alternatives released its own report in 2024, which mentioned the “motherhood penalty,” noting that women who have children often see their pay drop.
Lack of childcare options can also hurt women’s finances, with 49% of parents saying they had difficulty finding childcare in 2023, according to Statistics Canada. Many women may choose to extend their leaves from work due to trouble finding childcare.
A report by BMO in 2024 found that while a clear majority of women feel they are in control of their finances (75%), they’re still behind in many categories related to financial literacy and confidence.
The report found women were 7% less likely than men to create an annual budget and 4% less likely to have written a financial plan.
Fewer than half of the women surveyed (44%) said they had a conversation with a family member when they were growing up about things like budgeting, saving or financial planning.
Women were also 8% less likely to believe they were making any financial progress compared to men.
There’s a variety of ways that women can work to overcome challenges and improve their overall financial health.
Improving your knowledge of personal finance can empower you to make informed decisions about your money and work towards your financial goals. While expanding your financial literacy may seem daunting, it shouldn’t be. You don’t have to leave your house or take any special courses to get started. All the research can be done from your home.
Start by gaining a foundational understanding of key financial concepts such as budgeting, saving, and managing debt. This basic knowledge will serve as a strong foundation for building your financial literacy.
You can expand this knowledge by familiarizing yourself with some simple debt repayment options like debt consolidation. Or by looking into financial planning options for your future that align with your goals.
There is no right way to expand your financial literacy and understanding. It’s about what works for you and looking into the areas that will have the biggest impact on your long-term financial goals.
As we’ve seen, there are many women currently without any kind of budgeting system. Creating one can help anyone improve their finances.
If you are currently without one and don’t know where to start, check out our article, where we examine the pros and cons of five different budgeting methods. Using a budgeting app can also make it easier for you to track everything.
By creating a detailed budget that outlines income, expenses, savings, and debt repayment, women currently without one can gain a clear understanding of their financial situation.
Regularly reviewing and adjusting the budget as needed ensures that financial goals remain achievable and that unexpected expenses can be managed without derailing financial progress.
Building savings is a goal we all have, as women earn less than men, it’s much more paramount.
To start, assess your monthly expenses, including essentials like housing, utilities, groceries, and transportation. Aim to save a portion of your income each month, starting with a realistic goal such as 10% of your earnings.
Automate your savings by setting up direct deposits into a separate savings account. Consider opening a high-yield savings account to maximize your savings with better interest rates.
Make sure to track your progress regularly to adjust your savings goals as your financial situation evolves.
Having savings equivalent to at least three to six months' worth of expenses provides a buffer during emergencies or disruptions in income. This financial cushion can reduce the need for borrowing in times of need. Building savings gradually over time ensures you're prepared for unforeseen circumstances while working towards your long-term financial goals.
Each year, hundreds of thousands of Canadian women take the courageous step of filing an insolvency to regain control of their finances.
At BDO Debt Solutions, we’re committed to empowering women and offering hope during times of financial hardship. Every day, our Licensed Insolvency Trustees work with women across the country to help them navigate their debt challenges with understanding and compassion. Our Trustees take a non-judgmental approach to helping you become debt-free.
Reaching out can be the first step toward a brighter financial future.
March 17, 2021
From the gender pay gap to gender stereotypes, women face a variety of financial challenges. We look at how to overcome them here.
