At some point in our lives, we have all experienced financial crises. With gender inequality still looming over us in the 21st century, women, especially Black women, find it difficult to get ahead financially; this is often exacerbated by student loan debt and a lack of financial literacy. Additionally, while all women face challenges in the workforce, Black women face both racial and gender inequality. These women struggle to get ahead due to the lack of available employment opportunities in the labor market, inequitable salary offerings, and having to allocate larger portions of their earnings toward student loan debt. This leaves them with less money for other financial priorities, often causing them to apply for more loans, thus accumulating more debt. However, with the knowledge of financial literacy, all women, especially Black women, can work to manage these financial challenges on their own while avoiding a greater disaster. Financial literacy gives us the skills to manage our money, allocate it where needed, and reach our financial goals. Acquiring such knowledge is the key to every woman’s financial stability.
Being from Africa, I am often discouraged by my perceptions of women’s financial knowledge. Many women are barred from financial decision-making, which contributes to a higher rate of financial illiteracy among women in the society. Most men prefer their wives stay at home, take care of the family and not contribute financially; this occurs despite some men earning little to nothing, negatively impacting a woman’s ability to make financial decisions. Even when women hold low-income jobs, many are still not capable of managing their daily income.
It may be quite difficult and challenging to achieve financial stability as a Black woman, but it is never impossible. Knowledge of financial literacy can start in the household with tasks as simple as involving children in the family’s day-to-day financial activities and decision-making for the betterment of their own future. This can help build and maintain generational wealth. Parents, teachers, and mentors should support children, girls in particular, and create opportunities to develop skills in money management, financial planning, and personal banking.
With the rising impact of technology on our lives, the internet has given us access to various means of learning, many of which can be used from the comfort of our own homes. These include online financial mentorship programs, podcasts and seminars. Utilizing these tools is a strong start to achieving a financial strategy. Being educated on basic financial concepts, money management, and investment savings can go a long way towards financial wellness. Additionally, making financial literacy compulsory in formal education is crucial, because critical understandings of this concept can also help prevent the racial wealth gap from expanding. Having financial education both teaches us to make smart decisions and helps us recover quickly from economic and financial disasters. For instance, understanding the need for an emergency fund, the impact of financial investments, and how to diversify our income can make a huge difference. These are not the only ways to address the racial wealth gap, but they are a strong step towards achieving that goal.
Another way to improve financial literacy is by seeking help from professional services. In June 2020, the Prosp(a)rity Project launched the Economic Empowerment Initiative (EEI), which aims to help Black women struggling with student loan debt. However, its main aim is not only to eliminate student loan debt but also to increase alternatives to loans for higher education. Additionally, the Prosp(a)rity Project connects Black women with financial consulting services. Ultimately, seeking out resources to learn more about financial literacy is crucial in taking steps towards financial freedom; no one can care more about your financial wellness than you.
More details can be found at The Prosp(a)rity Project.
References:
Elaine Silvestrini, Women & Financial Literacy: Facts, Resources & Tips
Bola Sokunbi, Why Your Financial Well-Being As A Woman of Color Is Critical
Jennifer Steaks, The Prosp(a)rity Project Wants To Give Black Women A Fighting Chance To Eliminate Student Loan Debt
Samantha Rose, Women and the Financial Literacy Gap - OppLoans