Why Are Women More Likely To Think They May Never Pay Off Credit Card Debt?
Credit card debt is an unfortunate reality that most Americans live with, but how long it will take to pay off depends.
According to a recent poll by GOBankingRates, which posed the question “How long do you think it will take you to pay off your credit card debt?” and received more than 9,000 responses, 36% of those in debt said it would take one to five years to pay and 30% thought they would pay it off in six to 12 months.
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About 26% thought it would take six to 10 years to pay it off or they wouldn’t be able to do it at all, and 64% of those who answered in this way were women.
Why are women so pessimistic? Simply put, they face more financial challenges and societal pressures than men — and that may make paying off credit card debt more difficult.
“There are several reasons why women in America may think it will take longer to pay off credit card debt,” said Levon L. Galstyan, CPA at Oak View Law Group. “One reason could be that women tend to have lower incomes than men, on average. This means they may have less disposable income to pay off debt.
“Additionally, women are more likely to take on more debt to pay for things like education and healthcare, which can make it harder to pay off credit card debt. Furthermore, societal expectations and discrimination can also play a role in causing women to take on more debt and thus take longer to pay it off.”
Let’s elaborate on each of these points and more.
Income Inequality
According to the most recent Census Bureau data, median income in 2021 was $61,180 for men, $51,226 for women.
“On average, women tend to earn less than men, which means they may have less disposable income to pay off debt,” Galstyan said. “This can make it more difficult for women to make large payments towards their credit card debt and thus take longer to pay it off.”
Higher Expenses for Healthcare and Education
Women pay an average of $1,639 per year more than men on healthcare alone.
“Women are more likely than men to have higher expenses, particularly healthcare and education,” Galstyan said. “These expenses can strain a woman’s finances, making it harder for her to pay off credit card debt.”
Steep Societal Expectations
“Societal expectations and discrimination can also play a role in causing women to take on more debt,” Galstyan said. “For example, women may be expected to take on more household expenses and childcare burdens, which can lead to increased credit card debt.”
Lack of Maternity Benefits
“Many jobs still don’t offer very good maternity leave benefits, which can be a huge financial stressor for working women having kids,” said Mark Wlosinski, a personal finance expert. “If a woman feels that she needs more time [with her children] than what her employer provided, it’s up to her to figure out how to replace her wages during that extra time. More often than not, credit cards step in as ‘the solution’ in those stressful times.”
The Pink Tax
“The pink tax also has a huge role in this statistic,” Wlosinski said. “It’s been proven that there’s a significantly higher markup on goods and services marketed for women vs. men.”
Lack of Financial Education
“Women may also need more access to financial education and resources, making it more difficult to understand and manage their credit card debt,” Galstyan said.
A GOBankingRates survey in 2022 indicated that about a quarter of women did not feel financially literate (15% of men felt the same).
Single Motherhood
“Single mothers are more likely to have debt and are less likely to have the resources to pay it off, leading to a longer time to pay it off,” Galstyan said.
More Student Loan Debt
“Putting aside just credit card debt, women earn approximately more than half of all bachelor’s degrees in the U.S., with a vast majority of them typically heading to private colleges that are generally expensive,” said Lucia Jensen, CEO of WeLoans. “On top of that, many of them tend to attend graduate school, which results in even bigger debt loads that often take longer to pay off.
“All this can be attributed to women having to strive for greater educational achievement in order to be competitive in the job market when facing off against male job candidates. In short, gender inequality in the workplace can be blamed, as most women are often forced to take on more debt just to have a higher chance of sitting at the main table.”
Don’t Take Your Time With Debt
Debt knows no gender and people must not take time paying it off, no matter how hard they have it. Tackle it like there’s no tomorrow.
“In general, when it comes to paying down debt, create a plan and take action immediately,” said Dr. Enoch Omololu, MSc, founder of Savvy New Canadians. “Make a list of all of your debts, including the amount you owe, the interest rate and the minimum monthly payment. This will give you a clear picture of your debt situation and help you prioritize which debts to pay off first.
“Look for ways to reduce your expenses and increase your income so that you can put more money toward your debt. Find a way to stop adding to your debt. Maybe it will take finding multiple side gigs, downsizing your home or moving to a smaller apartment, but whatever the measure you need to take is, do it. Paying off your credit debt should become your top financial priority.”
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This article originally appeared on GOBankingRates.com: Why Are Women More Likely To Think They May Never Pay Off Credit Card Debt?
