Mama always told me…
May always brings about those first day of summer weather and getting ready for the summer vacation. While we have started to enjoy longer days and warmer temperatures, we also stop to celebrate a very important person in our lives: Mom. I know as both a daughter and a mother, a lot of planning goes into spending that day with the women who gave us life, nurtured us and taught us so much. Recently, I have also started thinking about money lessons I was taught by my mother and the ones I am teaching my daughters. I also think about how different the financial outlook for women is now compared to my mother’s.
A B C and 123…
Mothers are the first teachers in a child life. Children are sponges and learning their basic life skills from observation of their parents. This includes watching the way their parents interact with their finances. My mother was like many women -she was the main person in charge of household spending and budgeting. Watching her taught me the importance of saving and budgeting for things like vacations and major expenses. I have found that I, like many clients, had many of our perceptions about money and wealth ingrained in us during our early years. In the book Sudden Wealth Solution by Pagliarini, he discusses money scripts and how we have pre-conceived relationships with money. These relationships come from how we have seen our mother’s relationship with money.
Mom, look at what I can do.
The advancement of women has been incredible. From the greatest generation to millennials, women have transformed themselves and the labor force in the United States. A Pew Research study highlighted in the article for Fact Tank: News in the Numbers the huge strides that women have made in between these generations. Only 9% of the women in 1965 completed a 4-year college degree. In contrast, 36% of millennial women attain bachelors’ degrees, and today are as 7% more likely to graduate than their male counterparts.
As millennial women become the most educated generation in history, they become a huge component of the American labor force. Again, according to the Pew Research study, in 1965 only 40% of women were employed. Today over 70% of women are employed. Unfortunately, gender pay equity has not caught up to this trend with women making roughly 20% less than their male colleagues.
One aspect that both mothers and daughters can grow together is in personal finance and financial planning. Yes, times are different. Gone are the days of my grandmother who didn’t do any of her banking. Yet, we still have a way to go. I talk to my girls and my client’s daughters about retirement planning, budgeting, saving and keeping their financial independence. We need to remind our daughters to make sure that long term family planning takes that into account that women are living longer and that, due to breaks in our career paths, our retirement savings do not mirror our partners. Most of all, we must empower the generation of women to come to be equals at the financial planning table.