A recent survey revealed both good and bad news for young women. The report stated that women have better credit scores than men the same age do. However, the former also have more debt than the latter. As a result, they are less satisfied with their financial status.
The survey involved 1,050 people born between 1980 and 1995. The questions asked were about their personal finances and the differences in how both sexes managed their money.
The Debt Factor
Men had an average debt of $53,000, which was 30 percent lower than their counterparts’ median debt of $68,000. According to the report, one of the main differences between was due to student loans. Women have an average of $15,000, as compared to men’s $8,500.
A student loan is a problem affecting millions of young adults in the United States. A majority of the borrowers are still paying for their college debt even when they are already in their 40s. The financial burden affects everyone, but women owe two-thirds of the total amount.
Women end up with bigger college debts because most of them choose to pursue more than just a bachelor’s degree. They enroll in post-graduate programs to make themselves more appealing to future, prospective employers.
Because they stay in school longer, women are already in their mid-20s when they enter the job market. Then they get married or raise a family, which contribute to the amount of time they need to take off from their job. As a result, they don’t have the income to pay back their debt.
Women also react differently to their financial burden. Twenty-three percent of female respondents said that the amount they owe frustrated them, compared to just seventeen percent of male respondents. More men also stated that their debt made them feel confident.
The Salary Gap
There’s no denying that there’s a salary gap between men and women in the United States. Fifty-seven percent of the men surveyed answered that they earned $50,000 or more each year. Only forty-two percent of female respondents said they achieved that milestone.
Statistics showed that the average male income is 13.5 percent higher than that of women. It puts women at a disadvantage, considering they have more debt to repay than men do.
The same survey also found out that most men prioritize earning more money over other aspects of their lives. Men look for higher paying jobs as the main goal in life. At the same time, women’s priority is to save. They want to increase their savings within the next couple of months.
Home Ownership
It is also not a surprise that more than half of the men said they own their home. On the other hand, only forty-four percent of women have a home to call their own. It might be indirectly related to women’s higher debt that gave them fewer opportunities to buy a home.
Better Credit Scores
The two pieces of good news for women in the report are their credit scores. They have a slightly better score at 666, compared to men’s, which is 661. There are also more women with a score higher than 700 among those surveyed than there are men.
The Bigger Picture
More graduates face a bleak economic future because of soaring student debt. In the last decade alone, the number of student loans tripled and reached more than $1 trillion. Young adults are already facing an insurmountable debt problem as soon as they step out of school.
Women might have better educational achievements, but that doesn’t provide them with better job opportunities. Spending more time studying also predicts a bigger financial burden as soon as they graduate.
Graduation means they need to pay off their debt, as well as pay for rent. With fewer high paying jobs, they take ones that are unrelated to their degree. As a result, women barely survive on less-than-satisfactory incomes. They can’t pay off without credit check loans, even if they want to do so.
As they miss payments, their credit ratings suffer, and they don’t have access to affordable financing options because of it. People who didn’t go to college have better chances of buying a house at a lower interest rate, as compared to college graduates, because they don’t have college debt.
Women, consequently, suffer more than men do because of a greater debt. They also have fewer opportunities to earn more income in their chosen industry.
Paying Off Debt
Paying off debt fast is the best solution to the problem. Doing so means creating a budget and keeping expenses to a minimum. Young adults must also pay more than the minimum amount each month so that they end up paying less in interest.
If you have more than one debt, it is best to tackle them one at a time. Choose one to pay down first, while paying the minimum on the rest. Once you have paid off one, begin paying on the next one. You can pay more monthly because you eliminated one. Put that extra cash into paying off the next one. Repeat these steps until you have paid off all your loans.
Women might be dealt a bad hand in terms of debt, but they should not stop doing their best to control their finances. They should take advantage of their higher credit score to get a better refinancing deal, which would then allow them to pay less for the debt they accumulated while earning their degrees. Their financial burden should not stop women from pursuing their life goals in order to become successful in their chosen fields.
