Hi all! Life has been a bit crazy over here at the CMO place, leading to a short hiatus from the blog. But after some recent events in the personal finance world, I just had to write an article. This is a subject I’ve given a lot of thought to over the years, and I’d love to share it with you.

What recent events am I talking about? Let’s see – there was a post about all the top up and coming personal finance bloggers. Luckily my friend Laurie Three Year (and possibly others) stopped by to point out that, um, EVERY SINGLE BLOGGER LISTED was male. A new section was added to fess up to the oversight and list just up and coming women, which was frankly almost worse. Listing women in their own “separate but equal” section of the article is honestly a bit insulting.

Then there was a listing on Twitter of all the awesome interviews a popular finance blogger has scored over the last few years. Again…no women. This time it was the awesome Our Next Life who called him out, and I echoed her sentiment (it was the first thing I noticed when I read the list). That resulted in an invitation to create a guest post. Which was appreciated, but really, it had a feeling of only being invited because we pointed out the error. That we were being invited because of our gender, not because we’re just awesome people to interview.

Note – I’m not going to name names here, because I believe they recognize their mistake and don’t need further admonishment.  I assume they’re using this as an opportunity to reflect on their personal attitudes on gender and money.

Then just this past weekend the news broke that SoFi, darling of the blogger affiliate links, was going to have to have its CEO resign due to sexual harassment claims. Although sexism isn’t uncommon in the tech industry (see my article on thoughts on Google’s Manifestbro by He Who Must Not Be Named), it was sad to see that this attitude has infiltrated FinTech startups. It’s sad, but not surprising. Look no further than the scandals at Uber to see some examples of sexisim in Silicon Valley.

Seeing all of this go down over the course of just a few weeks inspired me to get out my computer and send some encouragement to my fellow women, and other marginalized groups. And that encouragement is a reflection on the fact that money is genderless. It is also race-less, doesn’t care about your sexuality, and if you have different abilities, it’s oblivious.

Does this mean that the subject of money and gender (or race, sexual orientation, ability) doesn’t matter? Of course it matters. Consider the following sobering statistics.

·         Women still earn 80 cents for every dollar a man earns

·         Interestingly, African American women earn 90 cents for every dollar an African American man makes. Sounds promising? Sure, until you find out that an African American man on average only makes 69 cents for every dollar a white man makes. So an African American woman makes 62 cents for every dollar a white man makes

·         Hispanic, native Hawaiian, and American Indian men and women also make less than white men, with women earning less than men in every case

·         Gay and bisexual men earn 10-32 percent less than heterosexual men. Fortunately this doesn’t seem to impact lesbian women, although they do still not earn as much as men.

·         Transgender women’s pay falls by a third after their transition, although transgender men seem to experience a bump in earnings

·         Folks with disabilities may not be able to work at all-or might be forced to work in lower paying jobs. Specifics depend greatly on the nature of the disability, but studies show a 37% disadvantage in earning power

So we know these groups are disadvantaged when it comes to earning money. Instead of working for X time to earn a dollar, they need to work for X plus an additional amount of time. Is that fair? No. Are there a lot of reasons for this – societal, choice of career, choice to stay at home with children or downshift to be with family, overt and covert discrimination, lack of support, etc? Yes. Am I going to delve deep into these reasons? Not today, no. Today instead I’m going to celebrate the power of what you can do once you hold that dollar in your hand – and the fact that once you have that dollar, you are equal to anyone else.

These women all have one thing in common – if they invest into an S&P 500 index fund, they’ll get the same one, five, ten, and fifteen year return as a man.

Money Is Genderless – And It’s Awesome

What do I mean about money being genderless? And why is that an awesome, amazing, powerful concept for all of us?

Picture a dollar in your mind. That dollar is not just a piece of paper. It represents a small slice of your life – your time – some sort of effort you exchanged for it. The paper is sitting in front of you. Pick it up, and look at it.

Guess what? That dollar doesn’t know the gender of the person holding it. It doesn’t know your race. Your sexuality is a mystery. You could be missing several limbs and it’s totally ignorant. It doesn’t know if you’re “too skinny” or “too fat”. It doesn’t judge your fashion sense or your level of attractiveness. It’s total, completely, utterly neutral and sits there, waiting for you to command it.

Think about that for a minute. That dollar, as it sits in your hand, has the same power as a dollar sitting in the hand of the proverbial white man. You have access to all the same investment vehicles as anyone else (except perhaps  investments for the super-rich). You just make a decision to put that dollar to grow for your future. And to then you need to actually put away that dollar, along with many friends, into an account or investment to work for you. And once its put away, it will go to work for you while you continue to work your job and live your life.

When you invest that dollar into the stock market, bonds, real estate investment trusts, or other financial instruments, your investment also doesn’t know your gender, race, etc. Instead, your investment quietly goes to work for you. Compounding is math-cold, hard math.. The market will go up, and down, side to side, and your dollar will still be there, chugging along. And over time, that market will go up.

Eventually your dollar will become two dollars, then four, then eight, and later sixteen. With enough time and patience, compounding will work its magic and your small investments over time will become a small (or possibly large) fortune. No matter how much or little you earn, setting aside money to invest for your future will pay off in a big way down the line. Once you have that dollar you can put it to work for you. Not sure what to do, or where to start investing? Just stick it into a total stock market index fund and forget you even have it.

Think you “don’t have enough” to start? Here’s a list of Schwab funds you can invest in with $100. You can start in Vanguard ETF’s with a single share. TIAA-CREF lets you start with $100. And of course there are the robo-advisors with no minimum (like Betterment) or low minimums (Wealthfront is $500).  The important thing when investing is to not let yourself be overwhelmed by analysis paralysis – just start.

Take Advantage Of This – And Take Charge Of Your Future

Why do I love this so much? It all goes back to the concept of seizing the things you can control – and not worrying so much about the things you can’t.

  • “God, grant me serenity to accept the things I cannot change, courage to change the things I can, and wisdom to know the difference.” ~ Serenity prayer
  • “If you don’t like something, change it. If you can‘t change it, change your attitude.” ~ Maya Angelou

There is not much I can personally do to overcome all the issues and discrimination women face when it comes to technology, work, and money. But I can do something – I can help inspire and educate other women.

And when it comes to my money, I can take full control. I can educate myself on what to do with it. I can take steps to prevent identity theft, write an investment policy statement, and learn about the benefits of indexing. I can read tons of books like the Millionaire Women Next Door and the four books that changed my financial life. And I can decide to put my money away, and keep putting it away, no matter what kind of crisis I may go through. If I keep it up, I will succeed. Math tells me so.

So take charge of your money. Realize that every dollar you can free up to invest in your future – your hopes and dreams for yourself, your partner, your spouse, your family – means your future self has two, four, eight, or more dollars thanks to you making the decision to invest.

  • Learn about personal finance through this blog and others. Read books and websites. Find a book or site that resonates with you and interests you-don’t give up if at first you find the discussions boring. There are a ton of sites out there. If you find a blog where your interest is piqued, reach out to the author. Most of us love talking with our readers.
  • Don’t let people take advantage of you. Look out for salespeople looking to earn a commission from your ignorance, or people who want to take money from your pocket and put it into theirs.
  • Do research and only invest in reputable investments until/unless you make an informed decision to take a calculated risk
  • Live below your means – as your income goes up, or your expenses go down, invest the extra instead of using it to inflate your lifestyle
  • Don’t get analysis paralysis. If you’re not sure what to invest in, just put the money in a total stock market fund until you figure it out. Have some more money? Put some into a total international fund too.

So go out there, get that dollar, and invest it. You’ll write me a thank you note in 20 years.

What are your thoughts on the cold, hard math of compounding? Are you like me and happy that money doesn’t care about your gender/race/orientation/abilities? Do you know someone who has become a successful investor despite the odds stacked against them? Let me know in the comments.

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17 thoughts on “Money Is Genderless – How Women Can Get A Fair Shake In the Financial World

  1. Thanks for the shout-out, Liz. Yes, yes, yes, those articles bugged me to no end. I have seen *many* instances where the “best” of the PF world are listed with zero women included, apart from the two you mentioned.

    So this article is a very refreshing take on what we women can do to remind ourselves of our power in this sphere. I love the fact that my index funds are blind and make money for me regardless of my gender. I love that my knowledge of personal finance, investing, and saving helps me take charge of my family’s finances and, over the past nine years, radically change our financial situation.

    1. I’m glad that you had the courage to point it out, Laurie. A lot of times I think we read articles like that-something that omits women, or perhaps something condescending towards women-and just roll our eyes and click away. It’s important that we speak up, and let people know that yes, we notice, and no, we don’t appreciate it. There’s a stereotype out there that women might manage day to day spending, but they have no interest in investing. That’s just not true-especially today, there are tons of women (single, married, partnered, with kids and not) that are interested in taking charge of their financial future.

  2. Happy to see you back today. And with such a compelling message! Women are way more powerful than we get credit for sometimes that’s for sure. I too am happy my money spends, invests, and compounds just like everyone else’s. Kudos to you and all the other women in the personal finance world for continuing to spread the message.

  3. What a great post Liz, and thanks for shedding light on the issue and taking the high road. It is so frustrating go read lists of bloggers or see panels about money that only include men. And it is almost the worst that it’s a complete oversight. Money may be gender less but that certainly doesn’t mean that men read females money writers at an equal rate.

    1. So true. I agree that it’s frustrating, and the worst part is that it needs to be pointed out. I love reading all sorts of different perspectives on money (male, female, married, single, kid-free, kids, etc.) specifically because I like to hear a variety of perspectives on personal finance. I only wish that was more the case across the board. That’s one reason why I’ve been happy to see the success of women PF bloggers like Paula Pant, Mrs. Frugalwoods, and Our Next Life.

  4. A great post! I haven’t been reading as much because of being away the last few weeks. But I’ve definitely seen what you pointed out here over the last six years of reading PF blogs. I also read a wide variety of writers. It has certainly helped me to see many perspectives and it has broadened my thinking. It also helps me as I try to share information with my parents, siblings, and my children.

    1. I also haven’t been reading as much in the past few weeks, with all the craziness at work and home. I’m hoping to have the time to get back to it soon! And I’m with you that this is nothing new. It’s also true of a lot of personal finance message boards I read, mostly men with very few women.

  5. I’ve seen numerous studies that say women doubt their effectiveness in investing, but as a group, they underestimate their skill while men overestimate theirs.

    So ladies, take Liz’s advice. It’s good advice. But also, trust yourselves to make your own decisions.

    1. I suspect if women do tend to underestimate their effectiveness in investing and men tend to overestimate theirs, both groups probably run into similar issues over time. Missing out on gains can be just as bad or worse than experiencing excessive losses!

  6. What a great article! I was just chatting offline with another female PF blogger about the “code” that surrounds investing. My cynical side says it’s there to dissuade the non-white males from entering the investment arena. I believe it’s there to intimidate the general populous. Otherwise wouldn’t we all be educated on such terminology either within our education system or even within the context of everyday public discourse? Anyway, I say F that! I might not know exactly what I’m doing but this Lady is investing! I’m not going to sit on the sidelines, too scared to try. I’ve been investing for less than 3 months and so far I’m LOVING it. I got pushed around by my fear/ignorance of money for far too long. It’s time those ugly little slips of paper work for me!

    1. I agree with you that there are lots of folks who have a vested interest in making you think that investing is a scary, difficult thing that’s best left to professionals. Unfortunately this intimidates people and can cause them to give up on ever understanding it. Kudos to you for getting started! Back when I started investing, I was no where near perfect at it, but the important thing was that I started. Had I waited until I felt like I knew what I was doing, it would have been many years of lost compounding before I started.

  7. It should be no surprise that women continue to be an afterthought in the PF space where we make up a large percentage of the population, but it is. It’s frustrating that men interact with us everyday yet fail to remember that we exist!

    But we remain in great company, nonetheless, and I’m so glad of the women here online who are thought-provoking and help each other learn and grow.

    1. One of the things I like best about starting this site is all the amazing women I’ve been able to (virtually) meet. Finding women interested in personal finance and investing in real life is difficult for me, and I hadn’t found many online either before this site. I’m glad we’ve all found one another to talk to.

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