Women were making huge progress in the workforce before the pandemic occurred. Then, after it hit, women’s jobs accounted for 55 percent of America’s total jobs lost.
Of the most heavily affected, some 58 percent of women working in lodging; 73 percent in personal services like hair salons; 73 percent working in clothing stores, and 84 percent in social assistance like family and day care.
It was really sad to see because these jobs were part of the fastest growing economic segments, driving strong job numbers and growth for several years, while male dominated industries like manufacturing were actually shrinking.
How COVID is Affecting Women
Unemployment reached an all time high of 14.7 percent in April, the highest number since the Great Depression. In July, the number had dropped to 10.2 percent. As a result, many women are still working from home today, finding it increasingly difficult to juggle their work while taking care of their children and also being “teacher” to them. They are also taking care of the house and trying to find time to take care of themselves and their own needs.
Other women stepped down from their jobs, no longer being able to balance home and work. Being at home with the kids and a spouse full time was like having another job according to some women. In order to do it successfully, something would have to give.
If mom got COVID, or worse yet her child got COVID, it would be the tipping point. Moms are trying to do too much and any kind of balance really doesn’t exist. Kudos to them if they do find a balance, which would really be amazing, but it is doubtful that they will find it.
There Are Resources Available
The Coronavirus Aid, Relief, and Economic Security (CARES) Act — this is a great benefit to a lot of Americans suffering through this horrible economic time, as The Act allows them to borrow up to $100,000 in their 401(k) plans without a tax penalty. CARES made it so people are not required to take a Required Minimum Distribution from their IRA in 2020. They can let their money grow for retirement.
The Economic Impact Payment — The CARES Act provided stimulus checks of $1,200 per adult. If you have a child, you get an additional $500 on top of that. PPP small business loans keep small businesses running. Obviously, another round is needed.
The Federal Student Loan payments are suspended through September 30, with no interest accruing during that time. An extension is in the works that will help a lot. Educational debt is one of the biggest debts in our country today at about $1.6 trillion.
The previous weekly unemployment payments of $600 ended July 31. A new amount will be decided upon, along with the creation of the Health Economic Assistance Liability Protection and Schools Act.
Knowing the Steps to Saving for the Future
Like my “COVID-19 and Retirement for Working Women” presentations, my talks are largely focused on women, from college students to retirees, because as women we are all affected by it differently. Sure, at the end of the day it affects all of us. But women lack that financial literacy. So, here we are. To begin with, we don’t have the financial knowledge we need, and then we get this huge smack in the face with COVID-19.
Women are in a tough financial position and don’t know what to do. However, I have the solution: today is the perfect time to say, “I need to take care of my finances and take matters into my own hands.” The first step is to understand their employer sponsored retirement plans. Surprisingly, 56 percent of working women do not participate in their retirement plans – not because they don’t want to – they simply don’t know what to do.
This is why I explain to women the difference between a 401(k), a 403(b), SEP IRAs, SIMPLE IRAs, profit sharing plans, and an IRA option. In other words, if they don’t have an employer sponsored plan, they can save for retirement on their own.
Another important factor to understand is budgeting. Our budget must be in place in order to have the financial freedom we want. Most women who have not budgeted before find themselves in situations where they have no income and no savings. They need to budget to ensure they are fulfilling their needs before their wants.
What I Have Learned
This entire COVID-19 situation has taught me the real importance of adapting yourself and accepting change. If you are not adapting, and not going from in person to the virtual, I believe it will be a detriment to you as a person and also to your career.
I need be in front of people, so I adapted by moving from in person seminars to virtual webinars to continue having these important conversations. I do, however, also realize that some people are not completely comfortable with doing it this way. But, we all realize how important it is to stay connected. We may be physically social distancing ourselves from others – through phone or computer – but the social aspect of it needs to remain intact.
Would you like to change your life and take control of your financial future by learning more about financial literacy? Please contact me at 412-633-1671. I would be glad to help.