The Gender Wage Gap Won’t Close Until 2152

women-still-earn-less

Equal pay for women? Not in this lifetime.

According to a new report from the American Association of University Women (AAUA), the pay gap may have narrowed considerably in the past 100 years, but it will still take another 136 to do away with it entirely.

In 2015, women working full-time in the U.S. were typically paid just 80% of what men were, creating a sizable 20% wage gap on average, AAUA said. Since 1960, that gap has narrowed thanks to women’s progress in education and their growing participation in the workforce. But in recent years, women’s progress has stalled, and if things continue to progress at this slower rate, “women will not reach pay equity with men until 2152,” AAUA warned. Here’s what that could mean for your money.

The Financial Effects of the Pay Gap 

As the AAUA pointed out, an average 20% pay gap affects women’s finances in myriad ways. For starters, it contributes directly to their poverty, which could be seen as recently as 2015, when 14% of women between the ages of 14 and 64 were living below the federal poverty level, compared with 11% of men, AAUA said. For those ages 65 and older, 10% of women were living in poverty, compared to 7% of men.

The damage persists well after a woman has left the workforce, AAUA said. When women retire, “they receive less income from Social Security, pensions and other sources than do retired men,” and other benefits such as disability and life insurance are smaller, since they’re typically based on earnings.

Broken down by demographic, the pay gap disproportionately affects women of color more than non-Hispanic white women and women of Asian heritage, AAUA said. And though the earnings and pay gap do vary according to a woman’s unique situation, they “persist across educational levels and [are] worse for African American and Hispanic women, even among college graduates,” AAUA said. The implication for student loan debt is concerning, since women working full-time in 2012 had a tougher time paying off their loans, on average, than men who were working full-time.

A Matter of Choice 

Personal choice also plays a key role in the pay gap. “In 2015,” AAUA said, “the U.S. civilian workforce included nearly 149 million full- and part-time employed workers; 53% were men, and 47% were women … But women and men tend to work in different jobs.” There are more women in education, office, health care and administrative support roles, AAUA said, while men are “disproportionally represented” in production, transportation, maintenance and repair roles. This means segregation is a factor, especially since the jobs associated with men tend to pay more than those occupied by women, despite requiring similar levels of skill.

While gender segregation has decreased in the past 40 years, AAUA said, women in male-dominated jobs still face other obstacles like being paid higher salaries and breaking into a historically male field in the first place. There is also the issue of parenting, which can require taking time off work or cutting back hours, which puts women with children in a tough spot. The so-called “motherhood penalty,” which goes beyond actual time taken out of the workforce, can hinder a woman’s chances of landing full-time employment.

Beyond these factors, some employers are just plain biased, and a woman’s choice of college major, occupation, work hours and time out of the workforce may have nothing to do with her odds of securing fair pay, the report said. Women are less likely to land leadership roles, AAUA said, and, of course, “gender bias also factors into how our society values some jobs over others.”

So What Can You Do? 

With all these factors in mind, how can modern-day women protect their finances? The odds certainly seem stacked against it, given the factors above. But there are ways to counter the problem. A budget can help you stay on top of your day-to-day finances without going into debt, while putting aside whatever you can afford can beef up your savings for the long term. It also helps to know where your credit stands, as this can give you a glimpse into the health of your finances. (You can view two of your free credit scores, updated every two weeks, as part of your credit snapshot on Credit.com.)

Image: IPGGutenbergUKLtd

The post The Gender Wage Gap Won’t Close Until 2152 appeared first on Credit.com.

4 Formidable Women in Finance

Smart, strong and inspiring women have left their marks in a variety of industries, and finance is no exception. From leading the International Monetary Fund, to managing trillions of dollars in financial assets, women are increasingly making a mark in the money world. So, in honor of International Women’s Day, here are some of the most notable women in finance.

1. Mary Callahan Erdoes, CEO, JPMorgan Asset Management

Considered one of Wall Street’s most “Powerful Women” and one of JPMorgan’s “Steadiest Leaders,” Erdoes attended Georgetown University where she earned her undergraduate degree in mathematics and later went on to receive her Master’s in Business Administration at Harvard University.

She made “The World’s 100 Most Powerful Women” list issued by Forbes in both 2014 and 2015. Erdoes is now the CEO of JPMorgan Asset Management. In 2014, her division logged its 23rd consecutive quarter of increased assets, setting a record high in the asset management industry. She manages more than $2.4 trillion in client assets and has grown her division’s revenue significantly.

Erdoes also had an active role with JPMorgan Asset Management Reentry Program, which targeted talented women who once worked in financial services, but left the industry to raise a family. Due to the big success of the Reentry Program, other parties have begun similar programs.

2. Barbara Byrne, Vice Chairman, Investment Banking at Barclays

Byrne’s name has made it into several well-deserved “Most Powerful Women” lists. She is no stranger to the banking world; Byrne has been in the industry for almost 40 years, setting the bar high for women in finance. The majority of her career was spent at Lehman Brothers, where she became the first ever female vice chairman. Byrne now works as a vice chairman in investment banking at Barclays. During her eight years at the firm, she has launched Barclays “Women in Leadership” index, enabling investors to support companies with female chief executives and/or boards with at least 25% women.

Byrne also invested in an indie film called “Equity,” a movie revolving around powerful women on Wall Street. Byrne explained her reason to invest was because it was a film surrounded by women – not only about women, but also produced by women. Byrne is a huge advocate and supporter of rising women at Barclays, often bringing her female staff members to client presentations and meetings. “I work with women on my team and then say ‘over to you’ in the session,” Byrne tells American Banker Magazine. “Into the deep water they go, and they always swim. Confidence is born.”

3. Janet Yellen, Chair of the Board of Governors, U.S. Federal Reserve System

When Janet Yellen became the first woman to become chair of the Federal Reserve Board it was a pivotal change for women in the banking industry. Yellen was nominated in 2013 by President Obama as board chair. Yellen previously served as a vice chair. She earned her bachelor’s degree at Brown University in 1967, then continued her education at Yale where she received her Ph.D. in 1971. Yellen maintains diversity in her career by periodically teaching at prestigious colleges.

4. Christine Lagarde, Managing Director, International Monetary Fund

Lagarde, pictured above, has never let her gender affect her future goals and accomplishments. She has proven herself as a pioneer for women in the world of banking and finance. Lagarde was born in Paris and attended school in the U.S. at Holton Arms School in Bethesda, Md.. She further pursued her education in law after graduating from Paris West University Nanterre La Défense, later obtaining a master’s degree from the Political Science Institute in Aix En Provence.

Lagarde reached success at a young age from her excellent performance on the French synchronized swim team. Lagarde has become extremely successful at her law career in the fields of anti-trust and labor law. She served as a partner with the international law firm of Baker & McKenzie, where the partnership elected her as the first female chair in October 1999. She held that position at the firm until June 2005 when she was named to her ministerial post in France. Lagarde is the first woman ever to lead the International Monetary Fund. Lagarde’s efforts to save the Euro have given her the experience of going head-to-head with some of the world’s most powerful countries.

Women continue to make a name for themselves, especially in the finance industry. In honor of women like these, consider taking some time today and throughout the rest of Women’s History Month to reflect on the accomplishments of these monumental figures.

While you’re at it, become formidable in your own financial world, You can monitor your financial goals (like building good credit) for free on Credit.com.

More on Credit Scores:

Image: Christine Lagarde, by Chip Somodevilla

The post 4 Formidable Women in Finance appeared first on Credit.com.