It's Time: Rise of Financially Independent Women
Here is a picture of the CEOs of the top financial companies.
These are the world's top greatest investors of all time.
Here is a picture of the top influencers in the financial sector.
This is a picture of the Wall Street trading floor,
and this is a chart showing the viewership of my personal finance YouTube channel based on gender.
Do you see a pattern here? I do. Money and financial well-being are as important for women as they are for men. But why is there such a huge disparity? If you are someone who believes in a fair world where women and men share the stage equally in every area, where women get equal chances and opportunities as men, then you should read this full.
For much of human history, women had very little say in financial matters. You probably know the reason why. Most societies considered men the sole breadwinners in the family, while women had to take care of children and do household tasks. And I am not talking about medieval times. What I am going to tell you was a very common scenario just a few decades ago.
Imagine this: You are a woman, you get married, and all of a sudden, your car and money belong to your husband. You have to ask your husband's permission if you want to work. You are no longer allowed to have your own bank account. Do you know which country had these draconian laws?
Saud Arabia, Afghanistan? No.This was the situation in 1950s Germany.
Until the Equal Rights Act was passed in 1958. And even then, women could only be employed if they fulfilled their "family duties."
We are in 2023, and it may seem ridiculous to still have these conversations. However, the truth is that while good progress has been made over the last few years, there is still a severe gender equality problem that exists in our homes and in our workplaces, especially when it comes to the topic of finances. But before we dive into those problems, I need to talk about a superwoman.
She was born in a rural village in India in the late 60s. This was a time when Indian society was highly patriarchal. Girls were considered a liability, and educating a girl child was seen as a nonprofitable undertaking. This was a time when a woman's primary job was seen as being at home, taking care of her husband and family, and those who went to work were highly frowned upon. Despite all these odds, she attended college and got a commerce degree.
In 1981, she started working as a bank clerk; in the mid-90s, she bought her first stock. After 39 years of service, she retired in 2020. But she didn't stop there. She didn't think to herself, I have come a long way against all the odds. Now it's time to sit back, relax, and enjoy the flight. No. She went on to pass the exam and became an investment broker. And lucky for me, she is the one who takes care of all my investments in India. That superwoman is my mother. Unfortunately, she is not the norm; she is an exception. And an inspiration for me and many others.
“Women should be financially independent. It doesn’t matter who your father is, who your husband is going to be, or who the man in your life is. You need to be responsible for your finances and be financially independent.”
Why does financial independence matter so much for women? The basic reason is the same as for men or everyone for that matter. Because it gives us the freedom and power to decide what we want to do with our life without making many adjustments. But when we dig deeper, we can find 2 main reasons why it's more important for a woman to be financially independent than a man.
According to the World health organization, one in three women faces some form of domestic violence. That's 736 million women around the world.
But there is also an irony in it. Many of these women depend on their abusers for their financial security. Unfortunately, they don't have any income or savings, which would otherwise give them a choice. But do you know what the sad thing is?
Even many women who earn an income and are independent on paper still live a dependent lifestyle. They leave the finances to the men fully or at least partially in their lives. All the salary is transferred to the husband at the end of the month, and he takes care of the finances. And then they have to ask their husband's permission to buy things for their needs. And in a way, I can understand why people find financial security in relationships, especially when you are married. It feels safe, stable, and reliable, like it will never end, but it does.
You could be stripped of your economic privilege at any point because "the so-called shared finances" are not actually your own. If you're currently in a relationship and don't have an income or means to support yourself financially when a need comes, you should not feel comfortable. But there is an even bigger injustice happening at our workplaces.
According to the World Economic Forum's Global Gender Gap Report of 2021, women, on average, earn only 63% of what men earn globally, despite having the same qualifications and experience as their male counterparts. And do you know how long it will take before this gap is closed? 2255, That's another 200 years. Your granddaughter and probably her granddaughter will be born in a world where they will be a step behind before starting with their life.
And the problem is not just the equality factor. There is a much more direct consequence for women due to this gap. The gender pay gap is thought to be a major contributor to old-age poverty in women. Earning less money means women will be less likely to be able to save money and invest in the future. And when we talk about investments, a much wider gap exists.
You remember the picture from the NYSE trading floor. Wall Street was an "all-boys club" and still is. In 2021, women made only one-third of all stock market investments. This is the gender investment gap, and it's not just because women earn less and invest less. And according to a report published by US national highway Administration, a woman is 17 percent more likely to die than a man in a car crash. Do you know why? Most cars have been designed around the average male, and the most commonly used car-crash dummy is 5 feet 9 inches tall and weighs 176 pounds.
According to a report in CNBC, less than 17 percent of senior positions in investment banks are held by women. So, when men handle the major investment roles in organizations, fewer policies can happen in the direction of women.
So in such an unfair world, it's even more important for women to aim for financial independence. But I believe most already understand the importance of that. The difficulty comes in the how-to part?
But before trying to do something, one must take time and understand the current situation. Because what is to be done will depend a lot on where you stand currently in your life.
What could be done?
Are you dependent on someone for money in your life? If then, you have to think of ways to reduce that dependency. And how to do that? There is only one way. Find ways to make money and create a stable income source. If you are educated, prepare a resume and apply for a job.
Every penny earned is a step towards your freedom. Or, if you are brave enough, kick-start your entrepreneurship journey. Understand your strengths. Those areas in which others come to you for advice. And then start building new skills in that area. Internet and social media have opened doors to the end of the world. You can reach anyone with any product or idea. Opportunities are just plenty.
If you already earn an income, then your next step should be to think of ways to make the most out of your money. For a start, you can do these 3 things.
Educate yourself: Start by doing the little things. Put aside 30 minutes a week to learn more about personal finance and an hour a month to go through your spending
If you are married or sharing expenses with someone, get involved more in financial matters. Money is one of the top sources of stress and tension in a relationship. The more you openly discuss it with your partner, the better it is for the relationship.
And very important, keep your personal and common accounts separate. You can contribute to the household expenses, family savings, and investments through the joint account and manage the rest of your money on your own. It's your hard-earned money. Only you have the right to it. Men have equal responsibility to involve their partners in the household finances.
Start saving and investing if you aren't already. Open an investment account and again start small. The easiest way is to find an online broker, register for a trading account, and invest in a lot cost index fund such as S&P500. As you improve your financial knowledge, you can tip your toes into stocks, bonds, and other equities. When you own investments, you'll naturally show interest in financial news and start to learn and understand how the market works.
This was one topic that I debated a lot in my mind. Creating a video about it takes a lot of effort, research, to shoot and to edit.
And as I mentioned earlier, most of my viewers are men. So, I wasn't sure if there was any point in putting in all this effort if there was no one to watch. Also, I assumed most people would prefer hearing all this from a woman with more direct experience with these problems than someone who just got the information by reading about it and observing it from a distance. But then I strongly believe this is an important topic to be discussed. Even if it makes a small impact on one person, I will consider this an effort well spent.
So, to all those women who are reading this blog, I will never really know how difficult it is to live as a woman in this world. But I know certain things. Nature has dealt you an unfair hand with our biological differences. Menstruation has its physical and emotional toll but also comes with additional expenses. Even though conceiving and carrying a child is an amazing experience, it also comes with its own set of sacrifices and risks.
Most religions are highly patriarchal and are created by men to serve the purposes of men. We live in a world where women are still denied entry into religious places because of gender. History has always treated women as second-class citizens. And what about the future.
An AI hiring tool developed at Amazon taught itself from past data that male candidates were preferable and ended up rejecting all female applicants.
I don't believe it will get any easier in the future. But then that's when you need to fight more. That is when you need to continue to step out, take charge and take the lead. And you have many highly successful women to take inspiration from. Those that don't kill you make you stronger.
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