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The gender pay gap has come under increased scrutiny in recent years — and for good reason. In 2018, U.S. government data show that median weekly earnings for men reached $973, while women earned $789. By this measure, women make 80% of what men make, or 80 cents for every dollar a man makes. The numbers skew even more when race is taken into account. Compared to the median earnings of white men, black women make 65% and Hispanic women make 62% — although Asian women make 94% of what white men take home. Meanwhile, black women earn 89% of what black men make, Hispanic women earn 86% of what Hispanic make, and Asian women make 76% of what Asian men take home.
MagnifyMoney has taken a deep dive into Federal Reserve data to look at the differences in savings between men and women. No matter how you slice it, men are earning more than women, but the data also show that women are better savers than men by some measures.
The data begs the question: Even though women earn less, why do they save a greater proportion of what they have than men do?
A 2017 Fidelity consumer analysis found that women tend to build financial plans and save with the future in mind, both for themselves and their families. Female Fidelity investors don’t often make quick portfolio changes in response to market changes. This correlates with the larger percent of women’s savings going to CDs, which can lock in high rates for years, compared to men, who choose to take more risks with their savings. Fidelity also found that women were more likely to keep their money in an “age-based allocation of investments” than men.
In a 2016 study, Vanguard also found that women are more likely than men to join their employer’s retirement savings plan. For example, 86% of women who made between $50,000 and $74,999 participated in their employer’s plan, while 77% of men in the same income group chose to participate.
All in all, it seems women are more conservative with the money they make. They choose to place their funds in stable savings vehicles and avoid taking on much risk, in order to save efficiently for the long term.
Using the Survey of Consumer Finances from the Federal Reserve, MagnifyMoney examined the differences of certain household assets between men and women from 1998 through 2016. For this analysis, coupled households and single households with children were excluded.