The Importance of Credit Education for Women

Just think, less than sixty years ago, a woman would have been hard pressed to get a credit card in her own name. While it’s been rather slow in coming, we’ve come a long way since then. In the 1960s, Americans addressed discrepancies between the sexes and enacted laws that would help level the playing field for women in areas of employment, housing and finance. Today thanks to many of these anti-discrimination laws, more women are in positions of authority and are the major breadwinners for their families. The days of minimal involvement in financial decisions are long gone. More than ever, women need to be educated in finance and credit as they are now crucial contributors to a balanced financial household.

A bigger emphasis needs to be placed on education.

A recent Experian survey touted as a win for women shows they are more knowledgeable than men when it comes to credit scores, which isn’t much to brag about when the overall statistics are examined and only 36% of women were able to define a good credit score. Studies like these continue to confirm the need to increase education for consumers of all ages and genders. When it comes to putting credit into play, the difference in national credit scores between the sexes vary only slightly.

It cannot be overstated that using credit responsibility is vital to establishing an excellent credit score. Knowing your score and how it rates from the vantage point of lenders will indicate whether you need to make changes in your financial habits. Without this knowledge, Americans flounder in a sea of debt and often have no clue as to why they are failing to achieve their dreams and live in a state of constant financial instability. For women who are challenged by insufficient income and often taken on a bigger percentage of the child raising responsibilities, a lack of financial education may mean a life of government assistance or, even worse, end in total destitution. One step towards gaining clarity on your financial health is getting a credit report check-up.

Why the focus on women?

On average women earn 23% less than men, making them more vulnerable to financial despair than men in the event of divorce or death. According to a 2011 report by the Census Bureau, women who divorced in the previous year were more likely to receive public assistance then men and 27% of these households had incomes of less than $25,000. Remaining in the dark on these issues may result in lost opportunities to borrow, costlier loans/credit and ultimately many unfulfilled dreams. By learning how to lower their interest rates and raise a low credit score, women will benefit in number of surprising ways:

• Better employment opportunities

• Chances for job advancement

• Improved living conditions

• Lower insurance premiums

Women need to take ownership of their own finances.

Unfortunately, many women don’t know their credit scores, the interest rate being charged for using a credit card or what is included in their credit reports. This information is crucial in understanding how financial management affects the cost of borrowing. Single women will learn, perhaps by trial and error, to effectively manage on their own, but education will help prevent some lessons learned by others the hard way. While it may be ideal for individuals to slowly learn financial lessons over time, some people don’t have this opportunity, as they are thrown into mature situations much sooner than expected. Regardless of circumstances it’s never too early or too late to begin learning and implementing the crucial components of healthy finances.

Married women need to avoid the temptation of solely leaving financial matters up to their husbands to manage. She needs to be involved in the whole gamut of their household finances. A full time partnership like marriage requires both parties work together to insure that all bills are paid on time and balances don’t get out of hand. Major decisions need to be made together with the focus on what’s good for the family and not a particular individual.

Many women are unaware of the influence they wield.

While it’s true that the amount of income a woman makes is a crucial component in effective credit management, knowledge and the confidence to speak up are important tools. By asking questions and demanding clear answers, more women will be better prepared to put in place a healthy strategy for their lifestyle and receive the treatment they deserve from the financial institutions they choose to do business with. It should never be simply a matter of accepting the original terms of particular credit card applications (example); women should use their negotiating prowess to pursue better rates. Competition is fierce in the banking world and a knowledgeable appeal may be rewarded with a lower interest rate that will help to improve financial stability.

Women have come a long way in a relatively short period of time. Extensive career training and quality education opportunities available to women have improved their quality of life and their ability to be self-sufficient. Women need to continue to learn the keys to financial management and the skills to implement them to build successful lives and security now and for the future.
Financial security is about more than money.

The Federal Reserve offers online resources to help consumer learn more about credit, equal credit opportunity rights and a number of other important consumer issues. We also have a legal right to request a free copy of your credit reports. This can be by calling 1-877-322-8228 or completing and mailing the Annual Credit Report Request Form.

About The Author: Vanessa May is a regular contributor to along with other financial blogs throughout the online community. She aims to educate consumers with the use government and other reputable sources to provide relevant news on money management, credit, debt, credit card applications, debt services and a wide range of other finance related topics.

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