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Here’s a mind-bending fact: Women could not get a credit card without their husband’s signature until 1974.

Women’s rights have been a national conversation since the age of suffrage — and conversations about equality are extremely prevalent in the news right now.

While it’s all important, this piece is going to focus on the personal finance aspect of women’s rights. In October 1974, The Equal Credit Opportunity Act (ECOA) aimed to limit financial discrimination based on gender (gender now cannot impact your ability to get credit).

This was a big step forward for women’s rights, but as you’ll see in the news, there’s still a lot of work to be done. Women currently represent nearly half of the U.S. labor force and make 85% of all consumer purchases, and yet, are still marginalized in several ways that can drastically affect their financial health and safety. Here are three of those ways.

Employment

According to the fall 2016 report from American Association of University Women (AAUW), women still earn 80 cents on the dollar compared to men, but equal pay isn’t the only concern when it comes to employment. For women who temporarily leave their jobs to have children or care for family members, the effects are more significant.

“We’ve come a long way in terms of splitting the roles and bending them in recent years, but women are still the primary caregivers of children and elderly parents, and that places an additional burden on them to schedule their day,” said Lisa Andrews, Ph.D., Career Services Manager for the Certified Financial Planning Board of Standards (CFP Board). “It requires them to coordinate more with their employer and juggle childcare to get to work at a certain time. Women are definitely called upon more to be flexible and that can create all kinds of difficulties in the workplace.”

Evidence shows that many women are penalized for attempting to strike a balance between work and home. The AAUW report also found that employers are less likely to promote women into roles of leadership because they assume caregiving responsibilities disqualify them for demanding positions. Conversely, men with families typically earn more and are promoted quicker, according to the report.

Retirement Savings

Diminished salaries and negotiation power place women at risk for long-term financial struggles, and the threat increases with age.

“There are many things about women’s lives that cost us more and earn us less,” said Eleanor Blayney, Consumer Advocate for CFP Board.

“We live longer, with the result that we have more costs over our lifetime. Beyond that, the probability is extremely high for women that they will be single in their retirement years,” Blayney said. “Men go into their 80s and 90s and they are more likely to have spouses and partners whereas women are more likely to be alone. There are financial consequences of being alone, and women are more likely to be poor as a result.”

In addition to age, a lack of financial planning involvement can hinder a woman’s ability to save for retirement.

“We were not the traditional investing branch of the family,” said Michelle Matson, author of “Rich Chick: The 9 Must-Have Accessories Every Girl Needs to Create Financial Confidence” and vice president of marketing with Matson Money investment firm. “Women weren’t expected to know about investing, but our lives have changed: We make more money, we have more responsibilities and we have broken through a lot of those social barriers. When it comes to investing, however, women haven’t caught up with that part of it yet.”

Credit Health

The sum of lower wages and little savings is usually credit damage, and the road to credit health can be tougher for women. For example, men tend to earn more money per year, which also means that their dollar-for-dollar debt-to-income ratio is less for equal purchases. This means they are in a better position to open new credit accounts, gain access to lower interest rates and manage debts more easily.

For example, men tend to earn more money than women, which also means that their dollar for dollar debt-to-income ratio is less. This means they are often in a better position to open new credit accounts and have access to lower interest rates. It’s a good idea to know where your credit stands, as this will give you insight into the types of credit cards you may qualify for, or even the terms and conditions you’d be eligible for. Even if you aren’t in the market for any of these things now, keeping an eye on your credit can help you improve or maintain your credit for future needs. (You can see two of your credit scores for free on Credit.com.)

In addition to monetary disadvantages, the Federal Trade Commission warns that social norms can result in damaging credit report errors, saying that “typically, there are two reasons women don’t have credit histories in their own names: Either they lost their credit histories when they married and changed their names, or creditors reported accounts shared by married couples in the husband’s name only.”

What Can You Do?

Despite the obstacles presented by gender inequality, experts agree that there are a few ways for women to ensure their financial security.

Seek equal opportunity employment: Companies who value women are getting serious about their ability to retain them. In 2016, Bloomberg launched the Financial Services Gender Equality Index, an annual list of financial companies committed to supporting female staff. “Evidence demonstrates that gender-equality policies and practices can affect a company’s financial performance, productivity and ability to retain top talent,” Angela Sun, Head of Strategy and Corporate Development, said in a press release. The National Association for Female Executives (NAFE) created a similar list of for-profit companies that recruit and hire women for executive positions, provide flexible work schedules and encourage female promotion.

Prioritize financial education: Investing is a learned skill (regardless of gender), and it’s a good idea not only to save but to also learn about the process.“It’s so important for women to reach out for more information to take control of their own lives,” Blayney said. “There are professionals who will educate and help you to put your interests first as required by the CFP certification. It’s a positive thing for all consumers, but because women have an especially harder road to hoe and because they may have been held back in the past, I think it’s all the more important.”

Build personal credit: Credit scoring is based on independent financial information, not the information of you and your spouse, so it’s a good idea to focus on your personal financial strength regardless of relationship status. These are a few ways to do that.

  • Maintain a strong payment history. Pay your bills on time to avoid late fees and credit damage — payment history is the largest influencer of your credit scores, accounting for 35% of the score.
  • Build credit history. Open a personal credit account in your name to establish history. While the age of your accounts impacts your scores, it’s the one thing you can’t rush — But you can start now.
  • Don’t carry too much debt. Experts recommend keeping your revolving credit balances at no more than 30%, ideally less than10%, of your overall credit limit to have the best effect on your credit scores. So, what this means is, if you have a $1,000 credit limit, you want to make sure your reported balance stays around $300, ideally $100. To take it one step further (and benefit your budget), aim to pay your monthly credit card balances in full to avoid accruing interest.

While it may seem like the odds are stacked against women when it comes to personal finance, a supportive work environment, financial education and continued credit health can help level the playing field. The key is vigilance, or as Blayney aptly put it, “In order to win, you’ve got to be in the game.”

Image: Geber86

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