by Dana George | May 27, 2020
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Think of the girls in your life -- your daughters, nieces, or granddaughters. How much do they know about finance? If you're not sure, it may be a good idea to find out. Girls who learn about money today will be more confident in their ability to take care of themselves as adults and less likely to be dependent on someone else.
It's impossible to overstate the value of teaching girls to be financially independent, rather than depending on their potential future husbands. According to the U.S. Census Bureau, 30% of adult women have never been married. And married women are likely to outlive their husbands by five years, on average. Teaching financial literacy now can lead to a lifetime of security and confidence.
In addition, the Credit Suisse Research Institute reports that females currently control 40% of global wealth. That percentage is expected to be closer to 77% by 2029. Whether they earn the money themselves or inherit it from parents or a spouse, women will control the purse strings. This influx of wealth makes the issue of financial management vital.
There's also a very serious reason why it's important for women to be financially savvy.
Studies have shown that as many as 99% of domestic violence cases involve financial abuse, and seven out of eight victims who leave their abusive partner report that they return due largely to financial difficulties. Having a solid understanding of money can help them avoid becoming stuck.
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Although it's important that girls and women be financially literate, studies show that many women lack confidence about money.
In 2012, the Girl Scouts of the USA's Girl Scout Research Institute (GSRI) conducted a survey about girls and finances. The study, Having it All: Girls & Financial Literacy, showed that most girls believe that they will grow up to be independent and financially successful. However, the GSRI noted that girls lack confidence when it comes to making financial decisions, with only 12% considering themselves "very confident."
Unfortunately, confidence doesn't always come with age. The Global Financial Literacy Excellence Center (GFLEC) asked 150,000 randomly selected adults -- representing more than 140 economies -- basic financial questions. Across the board, in both advanced and emerging economies, only 30% of women were deemed financially literate. According to the study, women were disproportionately more likely than men to answer "Do not know" to a financial question. Rather than taking a shot at the answer, they chose not to risk it.
That lack of confidence can impact everything, from buying property to investing for retirement. A 2017 study conducted by Willis Towers Watson found that more men than women consider saving for retirement a top priority. It's not that women don't want to plan for retirement, but a greater percentage feel unable to do so due to other financial pressures. Not surprisingly, 54% of men believe they will have enough money to last 25 years into retirement, while only 39% of women have the same level of confidence in their ability to retire.
It's up to you to make sure the girls in your life have what it takes to become financially savvy. Here are some stress-free ways to introduce your daughter, niece, or granddaughter to finances:
The more you teach a girl about finances, the more confident she will become. While financial literacy cannot insulate anyone from life's challenges, or prevent them from falling for the wrong person, it can help instill confidence. And at the end of the day, confidence may be what she needs to stay safe.
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