So much has happened in the year since we published the results of the first Ellevest Financial Wellbeing Survey last October. Inflation has hit us all hard. Markets were everywhere. Finally, the student debt is canceled (in part, anyway). And employment, if it seems better on the surface, remains a major issue for women.
We therefore wanted to know if and how women’s attitudes and approaches to financial well-being had also changed, particularly given their place in our wider culture. In addition to expanding our query with the first-ever comprehensive measure of women’s financial health in the United States (read all about Ellevest’s all-new Women’s Financial Health Index here), we’ve also brought the survey back to Ellevest’s Financial Wellness, speaking to nearly 2,500 adults nationwide about how they think about money — and what they do with it — in 2022. What we’ve learned gave us hope, but it also showed us how far we still have to go to achieve true financial gender equality. Let’s dive in.
The big news: women are prioritizing financial well-being in 2022
Last year, financial well-being was not too high on people’s list of priorities. Most of the women who responded to our survey at the time ranked it as the least important form of wellbeing – less important than physical, emotional and spiritual wellbeing. (Only 14% said it was important.) Call it a wake-up call, but this year they’re singing a different tune: In the same ranking, women are now three times more likely to see financial well-being as essential – he is now the second only. to mental well-being:
Mental well-being: 48% (vs 36% in 2021)
Financial well-being 42% (vs 14% in 2021)
Physical well-being 37% (vs 22% in 2021)
Spiritual well-being 22% (vs 18% in 2021)
They also follow the steps, taking steps to practice financial wellness regularly. Two-thirds of women say they have reduced their spending, for example. (Spending isn’t necessarily a problem, mind you; but spending more intentionally? That’s a win for financial well-being.) And — shut up, our hearts — they continue to invest in their retirement portfolios. , regardless of the economic storm we’ve weathered this year. 75% of women who are actively investing for their retirement say they have continued to contribute despite market volatility, compared to only two-thirds of men. (So when you see reports across the industry that ‘everyone’ is pulling their money out of the markets ‘in droves’…now you know what ‘everyone’ actually means, no matter what accompanying photo suggests.)
We know from experience – and from historical data – that staying the course in investing has been a winning strategy in times of economic downturn. It’s also not for nothing: women who invest tend to (a) invest more and (b) post better returns (up to 40 basis points). So if our survey results hold, it looks like women are well positioned to weather this tumultuous time and come out on top.
But financial stress still weighs heavily on women
Despite this happy news, financial stress still dominates women’s daily lives. 43% of women actively worry about money at least once a day, and 59% do so at least once a week. In both cases, it is men who worry (36% and 55%, respectively).
Not surprisingly, however, this kindly financial stress women face depends on their age:
Older Women (aka Gen X and Baby Boomers) are more likely to worry about purity economic volatility – things like inflation (91% of Boomer women versus 66% of Gen Z women), a possibility recession (81% of Boomer women vs. 45% of Gen Z women), or have to decrease spending (76% of Boomer women versus 55% of Gen Z women).
Young women (Millennials and Gen Z)meanwhile, are more likely to worry about how political issues will impact their finances in the short and long term – things like reproductive rights (63% of Gen Z women versus 45% of Boomer women), job security (62% of Gen Z women versus 52% of Gen X), the childcare costs (42% of Gen Z women versus 21% of Gen X), housing costs (51% of Gen Z women versus 45% of Gen X women), and women representation in government (54% of Gen Z women versus 38% of Gen X women).
But they are united on one particular concern: how they feel about their financial preparedness. We found that men (30%) were more than twice as likely as women (14%) to say they feel financially prepared for a recession. While we know that women’s financial confidence is a major issue at stake here – it’s possible to be in a good place but still doubt yourself – another can be a lack of external support. Nearly 70% of women also say they have never met a financial advisor, compared to just 41% of men – not surprisingly, given the male-dominated (read: alienating) industry. (Suffice it to say: Ellevest’s team of financial advisors is 100% female.)
Women have more immediate financial priorities
Given the nightmarish legal events of the past year — particularly the war on reproductive freedoms — it’s no surprise that financial priorities vary widely by gender. Men, on the one hand, feel able to prioritize their future – they have ranked growing their retirement savings as their #1 financial priority. But women’s priorities are closer to home: their main financial priority is to “support the family”, a category that includes “family planning, childcare, parental or sibling care, etc.” (“Supporting the family” comes in fourth place for men. 😒) The distribution of women’s priorities:
Support the family (family planning, childcare, parent/sibling care, etc.): 30%
Constitution of an emergency fund: 29%
Sticking to a budget: 26%
Grow retirement savings: 22%
Repayment of credit card debt: 22%
Creating a budget/spending plan: 20%
These findings also echo what we have seen in the broader conversation about the impact of family obligations on women’s economic and social equality: we know that women in heterosexual marriages are increasingly the primary providers of their families, even though men continue to be seen as breadwinners, and women’s incomes tend to decline or stagnate after having children, while new fathers see no change. We also know that women are taking on more household responsibilities, especially since the start of the pandemic, when jobs moved away.
And that’s all before considering the grim new realities that people who can give birth now face when it comes to the costs of reproductive health care. This is a key finding to watch out for, as family obligations – in other words, the need to prioritize the support of others before saving for one’s future – is likely a significant factor in the persistence of the gender pay gap.
Another reason why women might prioritize their retirement savings? For many, the idea of retiring sounds like a pipe dream. More than half (54%) of women who prioritize saving for retirement simply don’t believe they will be able to afford to retire. And the most worrying? Only 36% of women say they invest in general, compared to 63% of men.
Women put their money where their values are…and they’re willing to step on it (even in this economy)
Despite everything, women are attached to their values. 62% of the women we surveyed said they were concerned about climate change, and 53% said the overturning of Roe v. Wade earlier this year impacted their financial mindset.
As such, it’s no surprise that they’re also leading the way in ethical and sustainable spending and investing. 59% of women believe it is important that the companies they invest in or spend money in take a stand in favor of reproductive rights. And a third of Gen Z women (33%) and more than a quarter of Gen Y women (28%) say impact investing, i.e. investing in companies that correspond to their values, is important to them.
Along the same lines, women also hold high standards for their own employers, both financially and ethically. And this despite all that is happening in the labor market: even though 1 in 2 women (and nearly two-thirds of women in Gen Z and Millennials) said they were worried about their safety Right now, 44% of women say they would leave their current company if the company’s values around reproductive rights didn’t align with their own. 55% of women (and 62% of millennial women!) say they are actively looking for a new, better paid job.
There is no well-being without financial well-being
Why are so many women looking for more $$$? Of course, you can put it down to a “silent shutdown”. Or maybe it’s inflation – it’s hit us all hard and median income hasn’t budged to reflect the surge.
But the end result is the same as it always was: More money is more money. And even if they worry about their finances, women ask for what they need. When we asked women how they felt when they had more money, their top two emotions were ‘safe’ and ‘relaxed’. And 35% of women said having more money made them happier and more confident. This certainly confirms our previous research: we’ve known for years that saving and investing are key drivers of women’s confidence in their financial future; this is one of the main reasons why Ellevest’s core mission is to put more money in the hands of women.
It’s also why we are committed to improving and defending long-term financial well-being. When it comes to money, knowing what you have, knowing where you are going and taking steps to get there, and feeling good about yourself are all essential parts of a better quality of life.
Learn more about our financial wellness efforts, especially the new Ellevest Women’s Financial Health Index, and start your own financial wellness journey today.