Income gapThis week, I bring you good news and bad news, both of which come from a study by the folks at Financial Finesse. For three years, they've been analyzing the gender gap in financial literacy. The bad news is that after some progress in 2011, the gap appears to be widening in 2012. Women are falling behind, specifically when it comes to money management and investing.

Only 43% of women reported having an emergency fund in place (compared to 63% of men) and just over half felt comfortable with the amount of non-mortgage debt they were carrying (compared to 71% of men). About half of the men surveyed say they rebalance their investment portfolios, while among women, it was only a quarter.

Now for the good news: Women are slightly more likely to report participating in their employer's retirement plan, says Liz Davidson, CEO and founder of Financial Finesse. "We're doing a better job with some of those longer term issues, and at least at the rate we're participating, we're in line with men there. That hasn't always been the case."

That, of course, doesn't mean we're contributing the same amount in dollars and percentages, which is the next hurdle to tackle. "We ideally should be contributing more than men, because we live longer. And that makes the gap even more concerning, because women have pressures that men do not have," says Davidson.

One of those pressures: A high likelihood of having to be solely responsible for our own finances at some point. The National Center for Women and Retirement Research reports that nine out of 10 women will end up in this position, either after a divorce or the death of a spouse.

Those possibilities are no fun to think about, but you'll feel better if you prepare for the unexpected. Here's how to start.

• Put yourself first. We have a problem doing this in general, not just financially. If you don't prioritize yourself, you'll put the needs and wants of your family over your own -- whether that means saving for college or buying your teenager those pricey shoes has to have. One easy fix is to set up the contributions to your retirement account -- a 401(k) if you have access to one; an IRA if you don't -- so they are pulled automatically every month. Do the same for an emergency fund. That money is off limits.

• Get risky. Women are more likely to avoid risky investments -- recent research from Northwestern Mutual showed that 44% of women prefer lower risk choices, compared to only 35% of men. But low risk often means low return, and any gains you do see can be eaten away by inflation. It's important to have a good mix in your portfolio -- both equities and safer investments like bonds.

• Find (good) help. We're not afraid to ask for help, which is great. But often, that help arrives in the form of a financial adviser spewing jargon that does us no good, because we don't really understand it. I've said this before: If your financial adviser can't explain things in plain English and answer your questions, it's time to find a new one. Ask friends and co-workers for recommendations, meet with a few of advisers, and then go with your gut instinct.

• Do your own research. Maybe CNBC is intimidating to you. That's fine -- I'd tend to agree. But there are a ton of websites (like this one) and books (like my latest, Money Rules) that break down financial information into manageable pieces. Find one that speaks your language.




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Tiffany

The best way to get your money to really work for you and be 100% secure is through Infinite Banking.
Learn about the concept at www.thePrivatizedBankingMovement.org

July 26 2012 at 2:14 PM Report abuse rate up rate down Reply
ITATI Stocks

It is certainly unfortunate that women on average get paid less than men. However, it doesn't have to be a stumbling block. I focus on making the money I have work for me, not on whether someone else is bringing in more money than me. I have the tools (starting with the right training from my mentor) to get great results in the stock market. If you don't like the stock market, there are other avenues for growing the money that you bring in.
Aneshia Y. Smith
ITATIStocks@aol.com

July 18 2012 at 11:57 PM Report abuse rate up rate down Reply
Jewl

This is in reply to ATM -- are you serious? No one is asking to be handed more money, a better job, etc. It is a fact females are discriminated against in the workplace, especially in the office. And if a female has the misfortune to be in a clerical position -- she's no better than an indentured servant and good luck trying to get promoted or an ounce of respect. There is a clearly defined stigma on clericals -- even administrative or executive assistants -- and every buys into it and abides by it. You could be the best thing next to sliced bread and get no where -- because you are a secretary. Almost all secretaries are female. If there are any males, they are promoted. If the law required that 50% of support staff - namely office assistants and secretaries -- must be male -- then you'd see a change in attitude and suddenly there would be an upward path available.

July 17 2012 at 12:22 PM Report abuse rate up rate down Reply
Jewl

This is in reply to ATM -- are you serious? No one is asking to be handed more money, a better job, etc. It is a fact females are discriminated against in the workplace, especially in the office. And if a female has the misfortune to be in a clerical position -- she's no

July 17 2012 at 10:14 AM Report abuse rate up rate down Reply
Jewl

This is in reply to ATM -- are you serious? No one is asking to be handed more money, a better job, etc. It is a fact females are discriminated against in the workplace, especially in the office. And if a female has the misfortune to be in a clerical position -- she's no better than an indentured servant and good luck trying to get promoted or an ounce of respect. There is a clearly defined stigma on clerical

July 17 2012 at 10:08 AM Report abuse rate up rate down Reply
ATM

Listen up ladies - work longer hours, tqake less gossip breaks, generate more revenues, and close more deals. If you can do that, you can make more money - it is no different from men, and it already is avaiolable for you to obtain - so quit whining and either put up or shut up.

July 14 2012 at 4:49 PM Report abuse rate up rate down Reply
gmydogbud

It was an open secret in my day that women did not earn as much as a man because they were married and therefore did not need to earn as much money as they had a husband supporting them!

July 12 2012 at 6:20 PM Report abuse rate up rate down Reply