By: Lisa Grefe, Wealth Advisor and Trust Officer
As first seen in Des Moines Business Record’s Fearless Publication.
When it comes to money stereotypes, women often find themselves on the receiving end of remarks like “women aren’t good with money” or “they don’t understand investing.” Such stereotypes stand in the way of financial empowerment for women. As a woman in the financial industry, I have a responsibility to share an unspoken truth. I believe when women have more money, better things happen in our communities. We need to change the conversation around women and money, so they can own their financial future.
The need for change is evident. Women continue to grapple with the glaring gender pay gap and earn significantly less than their male counterparts for the same work. According to 2023 data from the AAUW, women working a full-time job in the U.S. earned 84 cents to the $1 that white, non-Hispanic men earned. That equates to a pay gap of 22% in Iowa. It is even worse for women of color, including Latinas and Black women.
I know firsthand the obstacles women endure, as I took a yearlong career break due to a major health challenge in my 30s. This meant lost wages and retirement savings and, unfortunately, a step back in my career until I recovered. When women are faced with unique challenges such as career breaks for caregiving responsibilities or health issues, it further exacerbates their financial vulnerability.
Most people have heard of the gender pay gap; however, the lesser-known gap is the gender wealth gap, which addresses how much people own, keep and have. This includes the value of assets, such as cash, real estate and investments, minus debts. The harsh reality is that women own less. In fact, we overall own a mere 32 cents on the dollar. Wealth provides leverage to compound, multiply and grow. Wealth can be passed down generationally and can provide access and opportunity.
Challenges related to building wealth were apparent in this year’s Business Record gender equity 2024 survey. Respondents who identified as women or nonbinary noted that two of the top challenges were investing money (44.2%) and planning for retirement (40%). A big difference was noted in the answer “none of the above” – 68% of male respondents selected that they didn’t have any of the financial challenges listed.
To truly empower women in handling their finances, we must first acknowledge and address these systemic barriers. It starts with education and awareness. By equipping women with the tools to understand budgeting, investing and retirement planning, we can empower them to make informed financial decisions that align with their goals and aspirations.
At First Community Trust, I work with clients to develop tailored financial plans, in addition to assisting them with retirement planning, retirement income strategies and investment planning, as well as generational wealth transfer. Being front and center in this industry, I am quite passionate about getting women to invest. Women outlive men by nearly six years, which means planning for additional income throughout our lifetime is critical.
When I begin to create an investment plan, common questions I hear as an adviser are: “How do I start investing?” “Where do I start?” “When is the best time to start?” “Am I going to be OK in retirement?” “What should I invest in?” and “It can feel overwhelming.” If you are experiencing this analysis paralysis, here are a few next steps to consider:
What can you do today?
- It’s better to start than to know everything. Do you get a match with your 401(k) at work? Start there.
- Think of yourself as an investor and overcome your fear. Historically speaking, investing in the S&P 500 since its inception in 1928 has had an average annualized return of 9.9% through Dec. 31, 2023. A reminder that returns aren’t guaranteed, so you need to be comfortable with some risk.
- Invest in a diversified portfolio based on your timeline (age, retirement). Start from where you are.
- If you have an investment portfolio already, nice job! It might be time to review again and plan for the unexpected. Is your portfolio still aligned with your goals and values?
- If you have a partner, have a date night focused on a values-and-money conversation.
- Reach out to a trusted financial partner to get help.
What if you don’t have enough money to invest?
- If you have credit card bills to pay off, other debt or need to build emergency savings, it may be important to focus on that first.
- Negotiate a raise. Change careers. Find a manager, mentor or sponsor who will lift you up in your career and financially.
- If you have the privilege to make choices, you could start your own business and control your career path.
As the 2024 Girl Scouts of Greater Iowa Inspiring Advocate for Women recipient, I am dedicated to helping not only women, but also girls, find an appreciation and interest in developing their financial wellness. While there is much more work to do, I am happy to serve as a resource for those wanting to take the next steps in investing. In my role as a wealth adviser and trust officer with First Community Trust, I get the opportunity to work with Central Iowans to help them invest for their future and plan for retirement. I am proud to support women in our state as they begin to remove personal barriers preventing them from owning their financial futures.
By empowering women with the knowledge, resources and support to handle their finances effectively, we can create positive change in our local communities. It’s time to change the conversation and empower every woman to own her financial future. I hope you will join me in this mission.
Lisa Grefe is a wealth adviser and trust officer for First Community Trust. She helps individuals with retirement planning, retirement income strategies and investment planning, as well as generational wealth transfer. She currently serves members of Premier Credit Union and is the head girls soccer coach for Des Moines North High School.