Why Women Have More Trouble With Student and Personal Loan Debt – Part 1
Recently, new studies have been showing what for many of us has been quite obvious for some time already: Women are affected severely by wage gaps, which in turn affects their ability to repay student and personal loans.
Let’s take a closer look at this sad phenomenon:
Throughout the history of the United States, women have always earned less than men. However, student and personal loan debt is presented as an equal opportunity for both of them. So just take these two facts and put them together and you will have a very clear picture of how intimidating the post-college job market can look for women when compared to their male counterparts.
What is even more, another study, this time performed by the American Association of University Women, found out that as recently as of 2009, women that have been just one year out of college were already earning almost 20 percent less than men in the same situation, yet women had still acquired just as much student loans and personal loans as men, with amounts bordering the $20,000 each. As if that not were bad enough, women also acquired personal loans slightly more often than men, with 68 percent of women acquiring personal loans for college when compared to just 63 percent of men acquiring personal loans for the same purpose. As you might guess, this brings not one, but actually two problems as a consequence: First, the moment they enter the workforce, women are then not only earning less than men, but they will have, on average, to pay more personal loans than men with the smaller salaries they earn.
Here’s a another better picture of how important this salary gap can be: Several reports agree on that student or personal loan repayments that exceed 8 percent of earnings are very hard, if not plain impossible to manage. Even so, during the year 2009 it is estimated that about 20 percent of women (compared to 15 percent of men) that had been less than a year out of college were already spending at least 15 percent of their salaries in repaying personal loans. And if we count everyone paying more than that 8 percent in personal loan debt, we will find that an surprisingly high 47 percent of women, while only for 38 percent of men this was the case.
With all of this information, it is then quite easy to conclude that women have plain and simple, less money to live their lives. This translates into shorter (or none) vacations, less food spending, less savings and an overall lower living standard in the present and in the future.
Is there a way to reverse this situation? More than one expert agrees in that women don’t need to be in this situation. There is very little to do against the salary gap of course, but with more informed applications for personal loans on behalf of women and a better organized spending, women can also enjoy the same financial life and stability of men.
But we’ll leave that for our next entry, where we will take a look at a few more revealing statistics and at how women can reverse this financial situation somehow.