Bank of America today announced the findings of a new body of research on women and financial well-being, which concludes that 94% of women believe they will be personally responsible for their finances at some point in their adult lives. Despite this, about half of women (48%) feel confident about their finances and only 28% feel empowered to take action.
The study, which has been published in a new report titled Women, money, trust: a relationship for life, assessed how women rate their financial health, with the majority of women reporting that they are doing well managing their daily finances, such as paying their bills every month (70%) and following a budget (53%), however they are struggling with longer-term actions like paying down debt (44%), saving for emergencies (44%), saving for retirement (36%) and building wealth (27%). One in five women (21%) recognize that it is time to make a change in their finances.
“True financial freedom requires both short-term and long-term planning and the confidence to act,” said Lorna Sabbia, director of personal wealth and retirement solutions at Bank of America. “It is imperative that we give women the tools and resources to take charge of their financial future and close the gaps between confidence, empowerment and action.”
This new study continues Bank of America and Merrill’s extensive research efforts exploring women’s unique life journeys and how various factors affect their financial well-being. The report is based on a national survey of more than 3,500 women and 1,200 men; and examines the progress women are making in their financial journeys and where they might need additional guidance and support.
Women feel confident managing everyday financial tasks like paying bills (92%) and managing a budget (87%), but only half feel confident managing investments (53%) and building a diversified portfolio (44%). ).
While women and men have almost equal influence on everyday financial decisions, such as paying bills (68% of women vs. 67% of men) and determining the household budget (63% vs. 63%) , less than half of women feel they have influence when making investment decisions (46% vs. 64%). The top barriers women say keep them from investing include not having savings to invest (38%), lack of knowledge (32%) and believing investing is too risky (22%).
When asked about their financial regrets, nearly half of women (44%) said they hadn’t saved or invested sooner. Women also say they would have invested more of their money (26%), educated themselves more about money (23%), wouldn’t have taken on as much credit card debt (21%), chosen a paid career highest (19%). lived within their means (18%) and took better care of their health (14%).
- Younger women paving the way for open financial conversations. Younger women (ages 22-39) are more comfortable having financial conversations than their older counterparts (ages 65 and older), including speaking with financial advisors (73% vs. 64%), applying for new positions or better at work (74% vs. 42%), discussing new investment opportunities (65% vs. 44%), and asking for a raise (59% vs. 38%).
- Being debt free is seen as the main indicator of financial independence. 47% of women cited being debt-free as the hallmark of financial independence. Other top indicators included being able to afford an unexpected expense (39%), being able to support myself without financial help from my family (34%), and being able to support my family (32%). Paying off debt also topped the list of barriers to improving financial well-being (36%), followed by high cost of living (34%) and not getting paid enough (31%).
- Women’s confidence levels vary for financial events during different stages of life. Most women are confident about paying future health care costs (56%) and feeling comfortable in retirement (54%), but confidence levels decline when it comes to buying a home (40%), financing educating their children or grandchildren (38%) and caring for elderly parents (32%).
- Financial planning varies by group. While 82% of women have a financial plan, only 30% focused on plans of 10 years or more. Caucasian and Asian American women are more likely to have long-term plans (35% and 37%, respectively) than black (20%) or Hispanic women (20%). Women who identify as LGBTQ+ are also less likely to have a long-term plan (21%).
- Saving for retirement is top of mind, but many don’t have a practical plan. Saving for retirement topped the list of short-term (49%) and long-term (54%) goals, yet one in five women approaching retirement don’t have a financial plan. Additionally, 57% haven’t figured out how much to save for a comfortable retirement, and 40% aren’t confident they’ll stay comfortable in retirement.
- Older women turn to Social Security to finance retirement, younger women plan to lean on savings. 90% of women age 65 and older plan to rely on Social Security in retirement (vs. 49% of women ages 22-39). Younger women ages 22-39 are more likely to plan to use personal savings (63% vs. 53% of women age 65 and older).
- Women in the workforce face unique concerns, prioritizing pay increases over time off. Around half (49%) of women left the workforce at some point, with caregiving as the main reason (58%). While 36% returned to a low-paying job, the majority of women (77%) do not regret their decision to take time out of their career, and 71% say returning to work was rewarding. Additionally, when asked if they would prefer a higher salary or more time off, 61% said they would prefer a pay raise.
- Women continue to seek trusted sources of advice to help them on their financial journeys.. Although 35% say “a trusted source of advice” would help them manage their finances more easily, and 44% see a financial advisor as a key financial resource, 55% have never worked with one. In addition, although reliance on financial advisors increased only slightly with age (41% of women ages 22-39 vs. 47% of women age 65 and older), it increased significantly by income level (35% of women with less than $50,000 in income vs. 61% of women with more than $250k in income).
“At Bank of America, we are committed to helping all women navigate the nuances of their financial journeys by providing them with the critical education, professional advice and resources they need to build their confidence and take steps toward financial security,” said Sabbia. .
Bank of America Retirement and Personal Wealth Solutions the organization serves more than 25,000 companies of all sizes and more than 5.8 million employees as of December 31, 20211. Bank of America offers employees of institutional clients a variety of financial benefit programs to help them achieve their financial future, including our Financial Life Benefits® program. financial benefits of life offers a suite of workplace benefits and solutions designed to help meet employees’ short- and long-term financial needs. This comprehensive offering brings together traditional financial benefits, including retirement plans. twohealth savings twostock compensation two and non-qualified deferred compensation planstwo – with a range of banking and credit capabilities from Bank of America and investment capabilities from Merrill to help address employees’ financial needs more comprehensively.
Ipsos conducted a 21-minute online survey of a representative sample of over 3,500 women and over 1,200 men over the age of 22 in February 2022. Quotas were applied to ensure results were representative within gender by age, race, income and assets, marital status, employment status, and education. The survey content was developed by Ipsos in consultation with the Bank of America team.
Bank of America is one of the world’s leading financial institutions, serving individual consumers, small and medium-sized businesses, and large corporations with a full range of banking, investment, asset management, and other financial products and services, and risk management. The company offers unmatched convenience in the United States, serving approximately 67 million consumer and small business customers with approximately 4,100 retail financial centers, approximately 16,000 ATMsand award-winning digital banking with approximately 54 million verified digital users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a wide range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America provides industry-leading support to approximately 3 million small business households through a suite of innovative and easy-to-use online products and services. The company serves clients through operations in the United States, its territories and approximately 35 countries. Bank of America Corporation Stock (New York Stock Exchange: BAC) listed on the New York Stock Exchange
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Don Vecchiarello, Bank of America