Dear women of the world,
You are good with money.
I’m going to say that again. You’re good with money. Women save, on average, seven to sixteen percent more of their income than men. When a consumer credit counseling service performed a study they found that men defaulted on payment at a rate of six out of ten, clearly more than women. Single women (this includes divorced women) have grown to be more than one in five homebuyers, and we make up one-third of the growth in home ownership since 1994. We save more in our retirement accounts, engage in better investing strategies, and get a better return than men. Despite this 13% of us describe ourselves as financial beginners and only 20% of us feel well prepared to make important financial decisions, versus 3% and 45% of men, respectively. We aren’t lacking in financial smarts, we’re lacking in confidence.
In the interest of being fair, I must admit that women are more likely than men to carry a credit card balance, though not my much (sixty percent to fifty percent), make the minimum payment and be charged a late fee. But unpacking that data is complicated. When I was married we often carried a balance on a card that had been mine before the marriage. Because I’d added my ex as a second cardholder the balance was truly from his spending, but it would have shown up as mine on a credit report. Some of the debt on credit cards is from medical debt, which isn’t the same as a splurge on a fancy new purse. And no one cuts the data to find out how much of the debt carried by women is from a marriage settlement.
When I decided that I’d had enough and it was time to leave my ex I took a lot of steps. One of them was paying off our credit card balances. It added three months to my timeline – three months of going through the motions in a marriage I’d already mentally left – but I didn’t want to fight over it in our settlement. Despite my preparation, his lawyer took several months to sign off on and file the initial paperwork and, guess what? My ex had racked up close to five grand in debt during that period. When he tried to stick me with half during the negotiations I hit the roof and, luckily, won on that point.
We aren’t lacking in financial smarts, we’re lacking in confidence.
To be clear, I was lucky. And I was lucky that the legal system in my state didn’t force me to split the eighteen thousand dollars he’d racked up on credit cards in the period between filing the initial paperwork and the date of financial mediation. Many divorced women aren’t so lucky.
The laws regarding debt in divorce vary by state and are, at times, archaic. Looking at those balances, whether it’s credit cards or legal bills, and perhaps hearing the words of an ex –you’re so bad at budgeting, why are we always overdrawn? – ringing in our ears, we may fight despair. We may wonder if he was right, if we really do suck at managing our finances.
Because of cultural beliefs about money and gender, many men are given lessons about financial literacy growing up that women often are not. The independent women in my family taught me how to balance a checkbook at fourteen, my grandpa taught me about compound interest when I was in high school, and my step-mom had me on a mock budget prior to leaving for college. None of the other girls on my dorm floor arrived at college with these skills. Don’t underestimate how those lessons may have given your ex the appearance of a financial edge over you that had nothing to do with your smarts or gender. If you’ve never managed a budget before, yes, it may be hard at first. It’s a skill, and it can take time to learn. But *shakes off pompoms* you can do it.
Because of cultural beliefs, many men are given lessons about financial literacy growing up that women often are not.
There are many resources available, on the web, at your local bank, from a credit counseling service (be careful in whom you select), and advice from other women who’ve gone before. There are charities that will help you for free. It may take time, and discipline, though hopefully not too much, but you can do it. Your gender does not make you incapable of handling money. It just plain doesn’t. Believe in yourself, forgive yourself for the mistakes you may make along the way, and drown out any negative comments your ex may have made about your money smarts by reminding yourself that women are good with money.
In this case, the statistics are on your side.
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