The Gender Gap in Financial Literacy

Women have made remarkable progress in various areas that contributed to long-term economic health during the previous century, notably in terms of higher education and labor participation. We are, however, still falling behind in one major area: financial literacy. Financial literacy is the understanding and application of concepts of personal financial management, such as budgeting, investing, and debt management skills; these enable a person to use their financial resources to make informed and effective decisions in order to achieve financial well-being. It is a crucial skill for wealth generation.

Generational improvement in financial knowledge might be expected, that young and single women might perform similarly to their male counterparts. Interestingly, regardless of age, education, or marital status, the gender disparity in financial literacy endures. This gender imbalance is confusing, particularly in industrialized cultures where women outnumber men in higher education. As financial products multiply and become more complex, so does the importance of developing a financial education for the achievement of financial stability. Financial literacy is associated with more wealth, a higher probability of investment, better retirement preparedness, and less concern about financial problems. Systematic inequalities in financial literacy between men and women lead to women having lower chances of success in financial markets. 

In many cases, wealth equals freedom and safety. There is a strong association between financial dependence and patriarchal control, especially in family relationships. Women, in many parts of the world, are financially dependent on their male relatives (or even ex-relatives), especially women who do not participate in the labor force. Women’s subservience to males is maintained via financial dependency, which inhibits women’s autonomy. 

Women of all ages demonstrate relatively low financial literacy levels. Those who are likely to require a high level of financial knowledge, such as widows or single women, are also unfamiliar with concepts that are crucial to standard financial decisions. Married women often find themselves uninformed of the details and handling of household finances. Men in couples tend to engage in financial management, whereas married, divorced, and widowed women are less likely to develop their financial expertise. However, divorced women develop financial knowledge over time as they learn to manage their finances without the assistance of a spouse. In terms of marital status, married women are much more financially savvy than unmarried women; the same is not true for men. Since women typically live longer than men and are more likely to be widowed, enhancing women’s financial literacy is critical for retirement planning and long-term financial security.

According to a recent study, women are less confident than men in making many financial decisions, particularly major ones. A series of tests, however, revealed that women know more than they think they do and that confidence levels have a significant influence on how competent they consider themselves to be. Having a financial education is one of the most effective ways for women to protest the patriarchy. True equality will not be achieved until financial equality is. Financial independence will never be realized without a financial education; women will never have full equality without financial freedom and economic equality. What could be more feminist than a woman who pulls herself together and organizes her finances? Personally, I am passionate about empowering women through financial education

Women currently live longer lives than men but generate significantly less wealth. Many factors contribute to this problem, most notably the income disparity that persists in many professions and the financial literacy gap. Despite the fact that women are becoming more involved in the banking and finance industry, finance is still widely considered a masculine domain, reflected in stereotypes regarding gender and finance observed in young children. It is critical to create strategies to eliminate gender disparities and stereotypes, as well as to enhance women’s financial behavior.


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Tinghög, G., Ahmed, A., Barrafrem, K., Lind, T., Skagerlund, K., & Västfjäll, D. (2021). Gender differences in financial literacy: The role of stereotype threat. Journal of Economic Behavior & Organization, 192, 405-416.

Bucher-Koenen, T., Lusardi, A., Alessie, R. and van Rooij, M. (2017), How Financially Literate Are Women? An Overview and New Insights. Journal of Consumer Affairs, 51: 255-283.

Buchwald, E. (2021). What’s behind the male-female financial-literacy gap? These academics say they’ve found an answer. MarketWatch.

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Ryme Mounib is a Canadian and Moroccan environmental studies graduate from York University. She was born in Europe and raised between the Middle East and North America, and is currently based in Morocco. She is an entrepreneur, desk editor, and volunteer team leader at Politics4HerMENA. Ryme is interested in further studies in sustainability, international affairs, and commerce. She joined Politics4Her for the chance to make a difference in the lives of disadvantaged women and girls all around the world.

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