Bridging the Wealth Gap Between Women and Men
Given that women typically retire with 32% less wealth than men, the wealth gap remains a significant barrier to achieving financial equity. Unlike the wage gap, where women earn approximately 83 cents for every dollar men earn, the wealth gap encompasses broader financial inequities, including differences in savings, investments, and retirement readiness. Facts help clear away bad-faith arguments and misinformation. As of 2021, the median wealth of women-headed households was 45% lower than that of men-headed households. According to a survey of US adults aged 55-75, men save an average of $157,000 for retirement, while women save an average of $50,000. The wealth gap is not just a statistic. It affects families, communities, and long-term opportunities, which is why it needs to be bridged.
Understanding the wealth gap
Women often shoulder a disproportionate share of caregiving responsibilities, while disparities in education and training pathways make some career options more accessible than others. Even with equal access, the pay gap persists. A US Bureau of Labor Statistics report in 2023 showed that only in community and social work do men and women have close to pay parity across 22 different employment fields.
Why does the wealth gap persist?
Systemic inequalities and behavioral differences perpetuate the wealth gap. Time off for caregiving isn’t a one-and-done activity — caregiving is never done. A caregiver will step up when care is needed. A sick child, an ailing parent, or the possibility of either stunts career advancement. Eye-of-the-beholder measures of commitment (“How much do you want it?” and “If you want it, you’ll make time.”) only work if you are single, childless, and have someone else to manage the emotional and unpaid labor needs of a family. Or, to put it another way, if your earnings go up after becoming a parent, you are probably what economists call “a man.”
There is a persistent devaluation of work performed by women. When women enter a field in greater numbers, the average pay for that occupation tends to decline. Within education, close gender parity in base salaries is overtaken by additional outside-classroom earnings (e.g., summer school pay and leading extracurricular activities). Or, to put it another way, if you are a teacher unable to take on extracurricular activities after becoming a parent because you are expected to do the unpaid labor of running a household, you are probably what economists call “a woman.”
The financial impact of the wealth gap
The wealth gap has long-term implications, particularly for women in retirement. Reduced savings and lower Social Security benefits — due to lower lifetime earnings — leave many women financially vulnerable. These disparities will continue to compound without targeted interventions, affecting future generations.
Actionable strategies to close the wealth gap
Steps you can take to close the wealth gap
Use reputable salary data to understand your market range and ask for it with confidence.
Invest consistently and early to reap the benefits of compound growth. Diversification is key to financial success, with portfolios that balance stocks, bonds, and alternative investments alongside maximizing employer-sponsored retirement plans like 401(k)s.
Career breaks can slow financial momentum. Continue contributing to retirement accounts where possible, and consider options like spousal IRAs to prevent growth from stalling during transitions.
Steps employers can take to close the wealth gap
Address the wealth gap by supporting women’s financial growth through policies. Prioritizing transparency and flexibility goes a long way towards avoiding the “mommy track” many women find themselves pushed onto. The motherhood penalty and the fatherhood bonus are real. Reducing the parenthood penalty is essential to an inclusive workplace.
Regular pay audits and clear career pathways can help eliminate the inequities that contribute to wage disparities. By openly addressing compensation and promotion criteria, organizations can create a culture of fairness and trust.
Paid family leave and flexible work allow women to manage caregiving responsibilities without stalling their careers.
Return-to-work programs for women re-entering the workforce smooth the transition back into their roles — reducing the long-term financial impact of career interruptions.
Steps policymakers can take to close the wealth gap
Legislation creates an environment where financial equity becomes the standard rather than the exception.
Start with strengthening equal pay laws. Comprehensive measures to enforce equal pay not only improve fairness but also set a standard for workplace accountability.
Affordable childcare and eldercare services, along with tax incentives for caregiving-related expenses, ease the financial burdens that usually fall on women. Recognize the dual roles many women play as caregivers and contributors to the workforce—and ensure they are not penalized for balancing these responsibilities.
Financial stability during career breaks boosts long-term equity. Support portable retirement benefits and allow contributions during the period of unpaid work so women can continue building a secure financial future.
Closing the wealth gap between women and men isn’t just about numbers — it’s about changing systems, mindsets, and habits that have long favored one group over another. Financial equity grows when individuals, employers, and policymakers work in concert to remove barriers and expand opportunities. Women’s financial confidence and access to resources create ripple effects that strengthen families, communities, and the broader economy. By pairing structural change with personal action — earning what you’re worth, investing intentionally, and planning for the future — we move closer to a world where wealth reflects not gender but opportunity, effort, and purpose.
This content is for informational and educational purposes only and should not be construed as individualized advice or a recommendation for any specific product, strategy, or course of action. Brighton Jones, its affiliates, and employees do not provide personalized investment, financial, tax, or legal advice through this communication. This material is not intended to, and does not, create a fiduciary relationship under ERISA or any other applicable law. For individualized advice tailored to your specific circumstances, please consult with your adviser.
