Women’s Guide to Making Financial Moves After College

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Graduating from college is an exciting time, full of potential to begin investing in your financial and personal goals. But life after college brings its own challenges for women — especially if you’re carrying the burden of student debt, which many are. It’s helpful to arm yourself with solid practices as you embark on the next phase of your life. The earlier you’re able to start saving, build credit and knock down debt, the better your financial future will be.

Common Financial Challenges Women College Grads Experience

While there are many challenges college graduates face when it comes to their finances, women face a unique set of hurdles. Discrimination in the workplace, lack of representation in the job market (especially in certain fields where men dominate) and gender differences that impact workplace dynamics are all just some of the issues women confront.

But the gender pay gap is perhaps the biggest issue since the difference in what women earn compared to their male counterparts can influence their ability to pay off debt and save money.

Research has found that a year after graduation, a pay gap exists between women and men who majored in the same field. Among business majors, for example, women were paid just over $38,000, while men were paid just over $45,000. The gender pay gap eventually becomes the retirement gap.

These common challenges can impact finances in the following ways:

  • Common Challenge
    How It Impacts Money
  • Discrimination in the workplace
    Lack of financial opportunities to earn a higher wage in more specialized fields.
  • Unwelcoming work setting
    Likely to create an atmosphere where women feel less comfortable to speak up or ask for a pay increase.
  • Gender pay gap
    Can slow career progress and force some women to struggle with basic living expenses. Also, makes it harder to build wealth and save for retirement.

Tackling Your Student Loan and Other Debts

It can take many years for college graduates to pay off their student loans, but it can take even longer for women to do so in comparison to men. According to the AAUW, it can take women as much as two years longer than males to repay debt. This is largely due to the pay gap that exists between men and women.

Colleges and universities continue to increase attendance fees at a rate that doesn’t match the rise in the average income earned. While this can affect both sexes, women are more likely to fall back on loan repayments because they generally earn less than men.

Taking control of your debt and paying back your student loan is possible, especially with a plan. Here are some steps you can take to reduce your debt:

1

Know what kind of student loan you have

Private loans often don’t have the same benefits as federal or government-backed loans. Knowing who is servicing your loan helps you better deal with any issues that may arise.

2

Choose a payoff method

Decide which payoff approach works best for you. The debt avalanche method has you target debt that has the highest interest rate first, while the debt snowball method has you focus on paying small debts off first.

3

Set up automatic payments

This ensures you won’t default on payments or pay even more interest on late payments, and doing so can help lenders see you are a reliable borrower.

4

Make extra payments

Find ways to prioritize any extra money that you can put toward your debt. Even a small increase can help put a dent in the amount you owe over time.

An illustration of a young woman standing next to her desk trying to develop a strategic plan to be more confident at work.

Boosting Your Confidence in the Workplace

Entering the workforce as a new graduate can be overwhelming — and even more so for women. Studies have shown that women struggle with confidence early in their careers and are less likely to promote themselves compared to men.

Research has found women are generally less assertive and less successful than men when it comes to salary negotiations, and so they are less likely to be hired or offered competitive remuneration. When women agree to lower income levels, this only widens the gender gap even more.

There are also some areas of work that are dominated by men and seen to be out of bounds for women. There are many reasons for this, including the different ways men and women are socialized. For example, young boys are often encouraged to become scientists, upholding the societal perception that certain fields are for men only. Women may grow up seeing female nurses and teachers as role models who eventually inspire them to pursue careers in similar fields.

How to Advocate for Yourself

Learning how to establish independence as a woman and how best to navigate the job market and workplace dynamics that may exist are essential to overcoming the challenges that arise in the work world. Women are generally not as effective as men at self-advocacy, so it may take some work for it to become second nature. Here are some steps to take:

1

Focus on building confident behaviors

Start by finding small ways to assert yourself, such as showing up a few minutes early to meetings or volunteering to take the lead role on a project.

2

Use low-stakes opportunities to practice

Both in and outside of the workplace, practice becoming more comfortable at speaking up. When you have a thought, make sure to share it with others.

3

Keep a note of your wins

Be sure to record any successes you may have and use those to back up your requests in salary negotiations. If you make a stand for your desired salary, you are more likely to obtain it.

4

Talk to other women

Share your experiences with others and look for a mentor who can help guide you. Remember that you are never alone — many other women have gone through similar challenges throughout the ages.

How to Stand Out as a Job Applicant

Job-searching can be competitive, and hiring managers often have to sift through a high volume of resumes. Obtaining a job that will offer a reliable amount of financial security requires you to stand out as a strong candidate. There are steps you can take to ensure you leave a lasting impression:

1

Do your research

Read up as much as you can about the company and those who are doing the hiring ahead of time. Also, get to know the market you are entering, and the opportunities and challenges that may be unique to it.

2

Personalize your resume

Tailor the experience you have to fit the requirements of the job. If possible, reach out to your network to see if anyone can help with a referral, which can also help you stand out.

3

Demonstrate how you’ll add value

Use your previous accomplishments, even if they may only be sporting or academic achievements from college, to show how your skills and abilities will benefit the company.

4

Don’t be afraid to ask questions

This shows you know what you’re looking for and are confident enough in your abilities to find a company that fits you just as much as you fit it.

5

Build your brand

Use social media to showcase your work, skills and reputation. Doing so can help you obtain a following in the future and help more people become aware of your interests and talents.

An illustration of a young woman leaning against a stack of coins working on her financial foundation.

Establishing a Strong Financial Foundation

It’s never too early to start financial planning. Establishing a solid financial foundation depends a lot on your level of financial literacy. Women are less likely than men to be financially literate, and many graduates may not have the necessary financial skills at all.

While it is unclear if the financial literacy gender gap exists due to a lack of financial knowledge or confidence, financial literacy is a skill that can be learned. It starts with understanding a few basic principles that you can apply to different decisions in your life.

Create a Spending Plan and Budget

The first step to taking control of your financial life is to come up with a budget. This can impact what you’re able to spend and save, and it can give you a clearer picture of where you are and where you’re going. A budget can help you gauge how much you’re spending over a given period, and it can help you stay on track to reach your long-term financial goals, whether that’s paying off student debt or saving for your first house.

Once you’ve established the financial goals you’d like to achieve, there are a few steps you can take to start putting your budget to work. Many budgets can be made according to personal choice, but there are a few elements that are similar across the board.

1

List your income

Tally up what money is coming in, whether from a fixed salary or freelance income. You can also establish an average by looking at your bank statements from the past 12 months and taking note of the amounts that you earned.

2

List your expenses

Expenses generally fall under three categories: fixed, variable and discretionary. Fixed bills include those that usually stay the same month-to-month, such as rent. Any monthly savings goals can be included here, too. Variable expenses are those such as utilities, groceries and other obligations which tend to have fluctuating costs. Discretionary expenses, like clothing, eating out and entertainment, are considered optional expenses.

3

Track your cash flow

Find a suitable method to monitor your budget. If you’re new to budgeting, the pen-and-paper method may be the least intimidating. But if you’re a little more comfortable with letting technology help you, you can use a spreadsheet in Excel or Google Docs or even accounting software to help you keep track of your spending.

4

Adjust income and spending to meet your financial goals

Use the information gathered from tracking your income and expenses to see if you need to re-adjust your budget so that it’s more in line with your goals and expectations. You may need to cut down on discretionary spending if you’re trying to meet certain saving goals or, if there are bigger discrepancies, perhaps you need to make bigger lifestyle changes on the whole.

5

Be flexible

A budget is meant to grow with you and the various life stages you may go through, so be prepared to adjust and realign as needed. Reassess your budget periodically to observe whether your numbers hold true or whether you should reevaluate. Stay flexible and remember that circumstances may change.

Consider Your Insurance Premiums

One of the ways you can best keep expenses down is by making sure you have the most affordable rates for your fixed expenses. While there may not be much you can do about your rent, mortgage or car payments, you have more leeway when it comes to insurance for these items. There are ways to find affordable insurance providers, especially if you think you may currently be paying too much.

The renters insurance guide can help you compare quotes and find out which company offers the best rate for your state.

If you’re unsure as to how much you should be paying for your homeowners insurance, research the options that are available in your state, and check if you need personal property insurance, too.

When it comes to auto insurance, you can investigate the going rates in your area, and if you’re a young driver you’ll want to find out more about what you qualify for.

Life and health insurance can be tricky to nail down, but don’t neglect them because you never know when you may need them. Researching options for life insurance can give you a good idea of what plans are available, while looking into health insurance can help you find out if you qualify for Medicaid or other types of assistance.

Start Investing as Soon as You can

You’ve likely heard the adage ‘the sooner the better’ when it comes to investing, and it’s true. Compound interest works in your favor as a recent grad. Although it’s never too late to start, you have more time to grow your investments if you make a plan to save as soon as you leave college.

Type of Investment
How It Works
How to Get Started

Company-sponsored 401(k)

Your employer pays into this retirement plan, sometimes matching your contributions.

Find out if your employer offers this and begin making contributions.

IRA (individual retirement account)

For employers who don’t offer a 401(k) plan as an employee benefit, you can still open your own.

Decide on whether you’ll go with a traditional IRA, where you make pre-tax contributions, or a ROTH IRA, where you make post-tax contributions. Open an account at one of the institutions that offer these accounts.

Real estate

Buying property for short-term gains, known as ‘flipping’, or long-term appreciation, through rentals.

Determine your level of involvement. Find a mentor to show you the ropes, and team up with partners and investors to fund property purchases.

Stock market

Investing directly in a company’s stock, which carries a higher risk with a higher potential reward, and diversifying to help reduce risk against market volatility.

Start investing through mutual funds, made up of stocks, bonds and other types of assets professionally managed by an investment company. Gradually invest more as you continue to learn.

Investment clubs

Like-minded investors pool their contributions to purchase individual stocks or other financial products.

Look for trusted groups online and at your local library.

Build Your Credit

Having a good credit score is vital for the next phase of your life as a college grad. A good or excellent score, between 650-850, will ensure you have access to financial services and products that can make it easier to own a home, buy a car or even get a job.

You can build a healthy credit score by accruing a good financial history through on-time payments and strong management of existing credit. If you have no credit history or a limited one, consider opening a secure credit card. If you already have a student credit card, you don’t have to cancel it after graduating, but you may need to be reclassified to continue using it.

Expert Insight on Women Graduates’ Finances

Women graduates face unique challenges when it comes to their finances. MoneyGeek spoke with academics and others who work in the field to provide expert insight into best practices to help women on their way to a more fulfilling financial life.

  1. What challenges do women most frequently face when they begin their journey towards financial independence after leaving college?
  2. How can young women best set themselves up for a fruitful financial life that takes them from the post-college stage through to retirement?
Timi Joy Jorgensen
Timi Joy Jorgensen

Associate Professor and Director of Financial Education & Wellbeing at The American College of Financial Services

Christine Valenza Shin
Christine Valenza Shin

Associate Dean of Beyond Barnard

Mia Smith
Mia Smith

Director of Programs at American Association of University Women

Resources for Building Your Finances As a Woman

Starting a path toward financial independence once you’ve left college can seem intimidating. But there are plenty of resources that can help you navigate the terrain. Here are some of the resources that can help:

Financial Assistance Programs

  • AAUW: The American Association of University Women offers a substantial range of career development grants.
  • Department of Education and Cultural Affairs: This government department awards grants to support academic, cultural and professional goals.
  • GIRLBOSS Foundation Grant: This grant is awarded twice a year to female and female-identifying entrepreneurs in design, fashion, music and the arts who work in creative fields.

Career Advancement Programs and Services

  • Women Employed: Non-traditional students can find the help they need to succeed in their education and career goals through Women Employed programs, which are designed to bridge gaps in knowledge and skills.
  • Women In Data: This membership-based community seeks to close the gender gap and increase diversity in data careers by providing awareness, education and advancement to women in the tech industry.
  • Sisterhood Agenda: For the past 25 years, this group of women has been educating, empowering and supporting women around the world with their mentorship programs and partnerships.

Female Empowerment Programs

  • Department of Education and Cultural Affairs: This US department provides resources on its site to uplift women in areas of education and career opportunities.
  • USAID: You’ll find a number of resources on gender equality and women’s empowerment through the development agency’s online platforms.
  • Women’s Empowerment: This initiative was founded to help women who find themselves homeless or living in poverty, with programs, services and resources.

Advocacy Organizations and Support Groups

  • Lean In: If you’re looking for a space to connect with other women or with your women co-workers, this is a group that helps facilitate that.
  • Authentic Connections: This organization runs groups that help participants develop strong, supportive relationships to increase their well-being and resilience.
  • Mayo Clinic: Most universities offer support groups for female students and graduates, but if you’re still struggling to find one, the Mayo Clinic can help link you up with like-minded women.

About the Author


expert-profile

Nadia Neophytou is a journalist based in New York City who writes for various leading American and South African publications, such as The Hollywood Reporter, Billboard, Deadline, Quartz, Glamour, the Mail & Guardian, the Sunday Times, Forbes Africa and more. Nadia also worked as an arts and entertainment journalist for Eyewitness News, and as the news network's US correspondent for South Africa. She has covered topics ranging from Occupy Wall Street, numerous mass shootings, the re-election of Barack Obama, Donald Trump's election and the #MeToo movement.


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