6 Things Women Should Know about Money and Debt

Financial planning is different for women than for men for many reasons, including the fact they statistically live longer, so they must save for a longer retirement. 

The good news is that women now have more career and financial opportunities than in the past. So, with the right money advice and a clear understanding of smart spending, sound investing, and debt relief options, women can take control of their futures and build the security they deserve.  

Here are six things women should know about money and debt to make informed choices that can help set them up for success. 

1. Women Are Making Progress in Closing the Gender Pay Gap

The gender pay gap refers to the difference between the earnings of men and women.

Pew Research reports that in 2024, women earned an average of 85% of the amount men earned. While it's unfortunate that the gender pay gap remains, the great news is that it is narrowing. In fact, in 2003, women earned just 81% of what men earned. The gender pay gap is smaller among younger workers.

As women assume more leadership roles, this gap seems likely to get smaller. Hopefully, progress will continue, giving women more disposable income they can use to pay off debt, invest for retirement, and accomplish other financial goals.

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2. Single Women Are More Likely to Be Homeowners Than Single Men

Single women in the U.S. are outpacing single men in owning homes. In fact, according to a 2023 Pew Research Center survey based on 2022 U.S. Census data, single women owned 58% of the 35.2 million homes that unmarried Americans own, compared to the 42% owned by single men. 

If you're preparing to become a homeowner, take the time to shop around for an affordable mortgage. Make sure your debt-to-income ratio is below the lender's guidelines, and (if possible) that your monthly payment doesn't take up more than 30% of your available income. You'll want to try to get the best credit score you can before buying, so you can qualify for a competitive rate.

If you've bought a home with all your financial ducks in a row, then you can build equity over time that can help increase your net worth. 

3. Women Are More Likely Than Men to Own Stocks

A 2023 Gallup Poll looked at stock ownership across the United States. It found that 62% of women owned stocks, compared with 59% of men. Owning stock is often a great way to build wealth because you can benefit from the compound growth that occurs when returns are reinvested to help you potentially earn more money.

When you have credit card debt, compound interest works against you. That's why getting credit card counseling to avoid carrying a credit card balance is a smart move. If you're successful in getting credit card debt relief and you can stop paying expensive interest, you'll be in a better financial position.

When you're the one benefitting from the compounding of interest through investing, your wealth can grow quickly because your money is working for you all the time. Make sure you understand any investments you buy, though—the stock market always involves risk, which you can minimize by diversifying and making smart choices.  

4. Women Are Less Likely to Be in Debt

Experian research found that men carry more debt than women across almost all categories.  Specifically, men average only slightly more in credit card debt than women, but 20% more personal loan debt; 16.3% more auto loan debt; and 9.7% more mortgage debt.

When you add all of this up, men carry 21.7% more debt than women, with men owing an average of $18,533 more. 

No matter your gender, you should try to limit the debt you take on. That way, you won't increase your costs by paying interest, and you won't commit future income to paying for things you purchased in the past. 

5. Women Are More Likely to Have a Written Plan for Their Money

Wells Fargo research showed 49% of women have a written plan for their money, compared to just 44% of men. Writing down your plan helps you achieve it, because:

• You have to think consciously about your goals

• You can create a roadmap to achieve your objectives

• You can more easily track your progress

• You can hold yourself accountable.

Men and women alike should take the time to make a written budget, as well as to write down short-, medium-, and long-term goals, and list steps you'll take to achieve them. 

6. Women May Be Better Investors

Wells Fargo also found that while female and male investors achieved similar results when investing, women took on far less risk to do so. And Fidelity's Women and Investing study also showed women outperformed men by 0.4% in investing, based on an analysis of more than 5 million Fidelity customers. 

Since it’s often a good idea to invest your money (once you have taken care of paying back high-interest debt), it’s worth getting informed so you can make good investing choices regardless of your gender. 

Women and Money: The Bottom Line

Women are doing well in catching up to men, but it's not a competition. Everyone, of every gender, should work towards taking smart financial steps whether that means debt consolidation to repay debt more easily, or figuring out how to invest money for the first time.

The good news is that there are professionals out there to help you. These professionals can help ensure that you are aware of the things women should know about money so you can make the moves to set yourself up for security in the future.