Employers’ roles in helping women work towards financial freedom

Using gender-specific data from Voya’s diversity, equity and inclusion (DEI) research analysis and women and financial equity research, we’ve found that many women are falling behind in their efforts to achieve financial goals, prepare for retirement and build long-term wealth.

Women have unique factors in their financial journeys. Some are long-established, like the ongoing gender wage gap, but some are being newly documented, like caregiving (an unpaid commitment that primarily falls to women¹) and its impacts to long-term wealth.

Yet despite the headwinds, women actively take steps to pursue financial freedom. Many seek out more education or advice and guidance services to learn how to better manage the money they have.

If such resources are offered through the workplace, employers can position themselves as powerful advocates — helping women boost their financial confidence and improve their outcomes by addressing their full financial wellness, including the logistical and psychological pieces.

Financial factors affecting women

Economic pressures

The ongoing gender wage gap leaves women more susceptible to the impacts of inflation. Voya consumer research found that 81% of women agree that inflation had made them more stressed about their personal financial situation.²

As a result, women are significantly more likely to tighten their spending budgets to pay for household expenses or other financial obligations.

Career interruptions

Women tend to experience numerous career interruptions, whether to raise children or take on the role of caregiver for a family member. And caregivers spend around a quarter (26%) of their income on caregiving expenses, adding to their financial burden.³

Career interruptions have significant financial impact, as they often result in reduced contributions to employer retirement plans (and missed employer matching contributions, if available) plus fewer opportunities for professional advancement and subsequent pay raises.⁴

Hindered savings potential

After using their funds for day-to-day living expenses, women have less money left to sock away for later. Voya’s DEI research found that women were more likely to have inadequate emergency savings — and this shortcoming can put their retirement at risk. 

Without sufficient emergency savings, employees often take early withdrawals from their workplace retirement plan to meet short-term financial needs. Women with inadequate emergency savings were over 4.5x times more likely to take a withdrawal from their plan.⁶

Competing priorities

With a long to-do list encompassing labor at both home and work, personal finances can quickly be de-prioritized. It’s not surprising that less than one-third of women feel in control of their finances.⁷

Thankfully, with the right tools, employers can help their female employees by easing some of the mental load that comes with complex financial planning and decision-making.

How employers can support women’s pursuit of financial freedom

1. Have a well-designed retirement program

There are retirement plan features that can help women make better use of their retirement plan to build long-term wealth — even when they’re worried about paying bills today. Think: auto enrollment, auto escalation and match programs that leverage the latest behavioral finance.

By focusing on overall retirement plan participation, you encourage women (and all employees) to save without thinking about it (and thus, help avoid the psychological barriers that often derail long-term goals).

Offering an emergency savings solution as part of your workplace benefits package encourages employees to build their own emergency fund using the same principles. They can make contributions directly from their paycheck, creating an out-of-sight-out-of-mind nest egg that is separate from their retirement accounts and isn’t linked to their everyday debit card.

2. Focus on financial confidence

Only 32% of women were mostly or very comfortable managing their retirement investments according to a 2023 report by the Federal Reserve System.⁹

Taking time to teach financial principles (and reinforce their existing financial knowledge) can help women build up their financial confidence. Giving them access to educational resources, like live and on-demand learning sessions, and sending targeted, engaging messages are great places to start.

You may also consider ways to support women’s other priorities, like caregiving. Our Voya Cares® program is specially designed to support disabled, aging and caregiving employees with advocacy and financial planning resources.

3. Make it personal

Broad financial education is beneficial for building overall confidence, but consider taking it a step further and help your female employees see what matters to their personal finances.

An employee experience like myVoyage can help bridge the gap between overarching and highly personalized financial insights. It quickly shows women their entire financial picture, then offers helpful resources and calls-to-action to guide them toward better decision-making. Using behavioral finance, the digital experience removes barriers between gaining knowledge and taking action.

Many women, however, already bear a large mental load, being the primary manager of their own home, family, work and other commitments. To help, consider offering advice and guidance options as part of your retirement program.

This is an easy way to help your female employees get financial advice for their unique situation. Having a professional financial planner in their corner may help women feel more confident about their short-term and long-term finances. 

Why financial wellness matters

Voya provides workplace benefits and retirement savings programs with purpose: Together, we fight for everyone’s opportunity for a better financial future. By recognizing and researching gaps in financial wellness across demographics, we can start to remove barriers to financial success and help women build financial confidence.

Through our research, we’ve found that more robust support and resources may help women build better financial futures for themselves and their families. And employers benefit from offering retirement plan features and workplace solutions that positively impact their employees’ lives.

For complete details, view the full report: How employers can help women boost financial confidence and retirement outcomes

Read Womens Report

When employers demonstrate their care for employees’ financial wellness, they may see improved employee engagement, productivity and retention rates, creating a healthier workforce and a stronger bottom line.

Read more: Voya Perspectives paper explores how DEI strategies can help close employee savings gaps