Progress on gender equality has taken a step backward — how can we fix it?

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Progress on gender equality has taken a step backward — how can we fix it?


Even before the pandemic, financial wellness had an especially significant role to play in women’s lives. 

That’s because financial stress—the greatest source of stress for all employees, at all income levels—affects women disproportionately: A 2019 Morgan Stanley and Financial Health Network study found 62% of women experience financial stress, compared to 53% of men. The research also found this financial stress affects productivity: almost four in five employees (78%) who report high financial stress say that they are distracted by stress at work.

Added to this reality, for the first time in decades, progress on gender equality has taken a step backwards—largely because of disruptions stemming from the coronavirus pandemic. Women continue to face unique pressures, but pursuing financial wellness doesn’t have to be one of them.

Gender equality, leadership, and the bottom line: Where we are in 2021

While traditional wealth management generally assumes income will grow at a steady rate each year, many women experience interruptions or inequalities in their careers that can affect both short- and long-term financial needs, from paying bills on time to building retirement savings.

 For example, 42% of business leaders report that women and minorities continue to experience barriers to career advancement in their organizations. Gender disparity widens at the top: Women comprise just 38% of middle management, 22% of C-suite, and 5% of CEO roles. And in terms of compensation, PayScale found a persistent 2% gender pay gap in 2020 when comparing the same jobs in the same regions with the same education credentials—while minority women made 4% less than white women.

 On top of this, women on average face higher levels of student debt, lower wages, earlier retirements, longer lifespans, and higher medical bills.   They’re also more likely to take leave or exit the workforce entirely to care for children and loved ones, which can interrupt long-term earnings.

 Finding an equitable approach to financial wellness

These obstacles and disparities can have ripple effects on women’s lifelong financial wellness, so it’s important to start with a full understanding of these challenges.

 As you approach big financial decisions and develop a long-term strategy, take the time to figure out where you are and where you want to go. Here are some general guidelines that may help you think through your goals and resources:

Understand what the workplace offers. Benefits like equity compensation can help women leaders address some of the unique pressures they face, but it’s critical to engage with your benefits plan and understand your resources and options. Women are less likely than men to say they understand the financial wellness benefits offered to them at work, and more likely to say they would benefit from clearer explanations of their benefits, easy access, and simplified enrollment.

Expand your support team. Morgan Stanley data found that 28% of women have a financial adviser, compared to 38% of men. Collaborating with a financial professional can help you free up time and energy. Even if you’re interested in managing your own investment decisions, connecting with financial professionals can be a way to unearth additional insights and opportunities that may fit your goals.

Take account of all your debt. Although women comprise slightly more than half of US college students, they carry two-thirds of the $1.6 trillion owed in student debt, according to the American Association of University Women. Does your current financial plan address student loan debt? Does your employer offer any benefits or tools that can help you take control and repay any outstanding balances?

 Have a contingency plan. Pay and promotion gaps, student debt, and unpaid leave can compound over a lifetime, so it’s important to consider how you’ll address any bumps in the road. Beyond building an emergency fund and feeding your retirement savings, create a contingency plan for supporting yourself and covering potential health care needs as you age. Talk to your support professionals about your plans and any future concerns as you determine the financial strategy that makes the most sense for you. 

Leading your financial future

When it comes to your personal financial wellness, it can help to think about your needs in both a personal and wider societal context.

Finding gender equity in financial wellness doesn’t mean simply treating everyone the same: It’s about meeting you where you are in your individual financial journey.

Thoughtful financial wellness can’t necessarily address all the unique societal challenges women face, but it can help you take meaningful steps toward a more equitable and secure financial future.

Krystal Barker Buissereth, CFA, is managing director and head of Financial Wellness at Morgan Stanley at Work.

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