Whenever I read another article about how hard it is to measure the ROI of financial wellness programs, I think back to my days as a psychology grad student. A large part of psychology and its history is focused on figuring out how to measure the intangible. The field of psychometrics measures abstract concepts such as intelligence, anxiety, and competence. And of course educators at all levels have engaged in assessing the effects of educational interventions, such as programs in financial literacy, for many years. …


Going down the poverty escalator

The Schwartz Center for Economic Policy Analysis at the New School estimates that roughly 40% of Americans, or 2 out of every 5 who are currently considered ‘middle-class’ based on their income, will fall into poverty or near poverty by the time they reach 65. The authors of the study defined middle class as an individual or couple earning more than twice the federal poverty level before age 65 (currently $12,140 for an individual, $16,460 for a couple) and then earning less than that threshold after age 65.

Lead researcher Teresa Ghilarducci, using data from the US Census Bureau, predicts…


The legislative debate during the passage of the new tax reform law about how 401(k)s would be affected caused jitters to retirement planners and financial advisors across the US. Many experts believe that giving employees any less incentive to save for retirement could exacerbate an already bleak scenario faced by most Americans. To understand the how and why of our national retirement crisis, let’s review a little history.

A Short History of the 401(k), or the Death of the Pension Plan

Once upon a time, people went to work for a company knowing that after spending 20 or 30 years there, they could retire with a monthly pension check from their former employer…


People realizing the median retirement account at age 61 contains only $17,000 and it has to last 20+ years

A new study reporting data from the Health and Retirement Study shows that a serious financial loss in midlife or later can increase the risk of death in both men and women by as much as 50% going forward. The 8,714 participants in the study, which began in 1990 and followed a nationally representative cohort of American adults 51 years of age or older, were interviewed every two years. They answered questions about their health and financial status, including the value of assets such as homes, businesses, and bank accounts and liabilities such as mortgages, consumer debt, and medical debt…


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While every woman should understandably be concerned about her own likely wealth gap, every business owner or CEO should be too. Women’s participation in the workforce is gradually falling, from approximately 60% in 1999 to 58.6% in 2010, and it is projected to drop even further, to 57.1% in 2020, according to the US Bureau of Labor. A 2017 study released by the Pew Research Center projects that the female share of the labor force will slow to 47.1% in 2025 and then taper off to 46.3% by 2060. While overall participation trends for both men and women are showing…


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Over the course of a woman’s lifetime, the income gap of 80 cents to the dollar snowballs into a wealth gap of 36 cents for every dollar of wealth owned by a man. Wealth is even more important than income, because it is equivalent to net worth, commonly defined as the difference between assets and liabilities. Net worth equals financial assets such as cash, stocks, and the equity in a home or business minus debts such as a mortgage or credit cards. Wealth matters even more than income, because wealth translates into economic security — the ability to withstand a…


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Women’s wealth gap accrues over time, and multiple factors contribute to its development over the course of a lifetime. These include occupational choices, the unpaid work of caring, and the role of asking for salary history during the job application process.

Occupational choices

Some argue that the frequently cited statistic of women earning only 80 cents for every dollar earned by a man in the same job does not take into account other factors such as the occupational choices women make, and that the gap can be explained by women simply choosing to take jobs or work in fields that traditionally pay…


Photo by Artem Mizyuk at Pexels

While everyone will likely face challenges on their journey to financial wellness, women face specific and systematic gender-based obstacles every day that make their journey more difficult and the destination of financial wellness harder for them to reach. These obstacles include the substantial and cumulative consequences of wage inequality, a lack of access to tools that can help build wealth, an increased debt burden on average as well as the historical and cultural perceptions that surround women’s roles.

Women are twice as likely to live in poverty during retirement compared to men, despite earning the majority of college degrees at…


Don’t be this guy — choose wisely!

In part 1 and part 2 of this series, I discussed the scope of the financial stress epidemic and presented a formula for estimating the cost savings to businesses that implement financial wellness. Financial wellness solutions are becoming increasingly popular with businesses looking to attract and retain top talent, increase employee productivity, reduce absenteeism and presenteeism, and decrease health care costs. Most look to external providers for financial wellness solutions rather than take on the daunting task of developing one in-house. With the increasing popularity of the concept, many financial services companies currently claim to offer a financial wellness solution…


Photo courtesy of Pixabay

In Part 1 of this series, I presented an overview of the research documenting the magnitude of financial stress affecting American workers. Recently, the academic focus on financial stress has shifted towards the concepts of financial wellness and financial well-being, similar to the increasing emphasis in health care on health promotion and disease prevention. While the term ‘financial wellness’ has become popular, no clear conceptual definition of just what constitutes financial wellness or well-being has become commonly accepted. A useful definition, based on a comprehensive review of existing research literature, expert panels, and open-ended interviews with consumers, has been proposed…

Martha Menard, PhD

Research scientist and financial coach. Qual and quant data diva. Founder, Society of Independent Women Investors. www.marthamenard.com

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