Independent Women's Forum - Research Areas > Financial Security

Podcast Alert: The Middle Class

info@iwf.org (Allison Kasic) — Fri, 07 Mar 2008 08:15:00 EST

In the latest IWF podcast, Carrie Lukas and I discuss several issues (the economic stimulus package, energy policy, and trade policy) that affect the middle class.

Give it a listen here.

The Gen X Financial Dilemma

info@iwf.org (Allison Kasic) — Tue, 22 Jan 2008 11:05:00 EST

Over at Townhall, Carrie Schwab Pomerantz lays out the financial challenges facing Gen X:

Popular movies in the last few years have depicted the slacker mentality attributed to the so-called Generation X. But recent studies on this age group, loosely defined as those born between 1965 and 1976, show that far from slacking, these young adults are coping with tremendous financial challenges.
Shaped by the social changes they saw growing up, many of them delayed marriage and family. Now they find themselves in their 30s and early 40s caught between paying off college loans, buying a first home, raising children, and somehow trying to plan for the future. It can seem like a long and lonesome road.

So, Reality Bites wasn't real? Sigh. At least the soundtrack was awesome. Turns out, the main financial concern is that Gen Xers are delaying saving for their retirement:

...the real worry is that along with postponing life decisions like marriage, children and homeownership, many in this generation may also be postponing saving for retirement. With housing and health care costs rising, pensions almost non-existent, future Social Security benefits questionable, and the likelihood that their children will be entering college right when they themselves are nearing retirement, this generation can't afford to wait any longer.

Pomerantz goes on to provide some helpful hints for retirement saving. Read her full column here. You can pick up more helpful financial tips in IWF's Young Woman's Guide to Financial Independence, available here.

IWF Policy Brief: The Young Woman's Guide to Financial Independence

info@iwf.org (Allison Maranuk) — Tue, 11 Dec 2007 14:58:00 EST

Download Brief #10 below.

Executive Summary

This paper aims to educate young women about how small decisions made at young ages can affect their financial freedom for decades to come. Women are outnumbering men in universities and participating in increasing numbers in the work force, but a strong understanding of financial matters is also important for long-term financial stability.

The first section of this paper discusses what a FICO (Fair Isaac Corporation) score, or your credit rating, is, how it is determined, why it is important, and how to improve or keep a great FICO score. The second section covers compensation, outlining six easy steps for successfully negotiating a first job offer, and describing why this process is so important. Moving beyond salary negotiations, the paper will also discuss how other decisions women make, such as job selection and periods of leave, affect their pay throughout their careers. The third section speaks to the importance of saving for retirement at a young age and suggests ways in which young women can start preparing for their retirements now.

IWF Policy Brief #10: The Young Woman's Guide to Financial Independence

info@iwf.org (Allison Maranuk) — Tue, 11 Dec 2007 14:46:00 EST

Is Globalization Really the Evil Monster People Think it is?

info@iwf.org (Anne Trenolone) — Tue, 27 Nov 2007 13:00:00 EST

I heard an interesting commentary piece on NPR, to be exact it ran on Marketplace, last evening that links in well with IWF's upcoming event: Success in the Global Economy: An Agenda for the 110th Congress which is focusing on the US economy in the context of globalization.

The piece notes an article that ran in The Wall Street Journal, "A Globalization Winner Joins in Trade Backlash" that contains this eyebrow raising statistic:

The latest Wall Street Journal/NBC News poll conducted earlier this month found that 60% of voters nationwide agreed with the statement that "foreign trade has been bad for the U.S. economy.

Of note is that the Marketplace commentary offered up by Paul Krugman was not exactly what I expected. Krugman is a columnist for The New York Times whose latest book is called The Conscience of a Liberal and his warning to Democratic presidential candidates is "Cool the Globalization Rhetoric". The intro to the piece sums it up this way:

A funny thing's happening on the way to the Democratic presidential nomination. The Wall Street Journal pointed it out the other day. Iowa voters are worried about the after-effects of globalization. So worried that the major Democratic candidates are working overtime talking down free trade. Globalization is turning into a hot-button campaign issue. Republicans are having their problems, too.
But commentator Paul Krugman says, its effects on the U.S. economy are overblown.

Krugman himself offers this:

Let's start with the idea that globalization makes it impossible for American workers to earn good wages. The facts say otherwise.

Both pieces offer a good picture of the globalization debate at the grassroots level.

Markets, Not Mandates, Are the Way to Provide for Paid Leave

info@iwf.org (Carrie L. Lukas) — Wed, 09 May 2007 00:00:00 EDT

"This debate is really about what we value in this nation. If we want strong families and a strong economy, if we care about the health, well-being and economic security of our families, we will waste no time in passing the Healthy Families Act."

That's the case for requiring businesses with fifteen or more employees to provide seven days of paid sick leave, as articulated by Debra Ness, president of the liberal National Partnership for Women and Families, at a recent Senate hearing. Opposing this legislation means opposing cancer patients and single mothers with terminally ill children--at least that's how the Left would like the debate over the creation of massive new federal mandates to unfold.

But you don't need to be an economist to understand that the issue is more complicated than just whether you care about the sick. Such government regulations infringe on an individual's right to freely contract for employment. These laws make it illegal to offer or accept a job that fails to provide this one specific form of compensation. That's a loss of liberty for individuals. It makes our workplaces a little less flexible, and is another step away from the concept of the free market economy and toward greater government control.

The practical effect for employees is that there will be fewer jobs and lower pay. Mandates create new costs for employers, and that means less money for employees. Many workers will find that there is a direct trade-off between more benefits and more take-home pay. Benefits accounted for more than 30 percent of the average worker's total compensation in 2006. A new mandate like paid leave means that this portion will grow, leaving less money in the average worker's pocket to spend or save as he sees fit.

The increased cost of hiring a worker also gives employers another reason to cut down on staff and look for opportunities to outsource jobs, so they don't have to pay to administer and implement these costly benefits.

Policymakers have better options if they want to help individuals who need time off from their jobs due to illness or other personal circumstances. First, it's important to recognize that most businesses are already providing paid leave benefits and finding other ways to help their workers address their personal needs.

According to the Department of Labor, in 2006, 82 percent of American workers in the private sector had access to some sort of paid leave, whether sick leave, vacation, or personal leave. Many businesses are also choosing to offer employees greater flexibility with their work hours and arrangements. As of May 2004, 27 percent of full-time wage and salary workers had arrangements that allowed them to vary their work start and end times. More than four million Americans telecommute most days and an estimated twenty million telecommute at least once a month. This flexibility provides employees with many advantages, including great ability to care for personal and family needs. Businesses competing to attract employees find that it makes business sense to offer such arrangements. That's how it works in a dynamic market economy.

In addition to relying on the competitive marketplace, policymakers should look at ways to make it easier for individuals to provide for themselves during periods when they cannot work. A first step would be to eliminate disincentives for private savings in our tax code to encourage individuals to put money away to provide for themselves in times of need. The government has created tax advantaged accounts for retirement, for educational expenses, and for healthcare costs. Similar efforts could be made to encourage individuals to save to provide for periods of leave. Workers could be allowed to put a few thousand pre-tax dollars per year into a "Paid Leave" savings account, which could be accessed without penalty when they have to take unpaid (or partially paid) leave due to illness or the birth of a child.

Such proposals won't provide the kind of sympathetic stories that appeal to the media or make for tear-jerking congressional testimony, but they will make it easier for individuals to provide for themselves when they are unable to work. Government mandates may sound like compassion, but they impose real costs on employers and ultimately on the employees they are intended to help.

A few (belated) words on women billionaires...

info@iwf.org (Charlotte Hays) — Mon, 12 Mar 2007 15:39:00 EDT

I'm late taking official notice of a story you've probably already seen- the new Forbes billionaires list. The big news is that there are more women on the list this year:

"There are some familiar faces out of the 83 women who made the list, such as Oprah Winfrey (worth US $1.5 billion) and J.K. Rowling (worth US $1 billion); both rags to riches stories."

This is irrefutable proof that women don't need government programs to help them make it in the business world- a fact our friends at NOW and similar organizations are unwilling to admit.

In fact, the strong economy today is something that the press (and I assume our friends at those other organizations) don't want to face:

"The media promote the idea that as the rich get richer, the poor are getting poorer, but according to a March 8 Associated Press article many people are getting richer, not just billionaires.

"'The net worth of U.S. households climbed to a record high in the final quarter of last year,' AP reported. For the entire year, household net worth increased by 7.4 percent on top of the 7.9 percent increase in 2005."

AP reported. For the entire year, household net worth increased by 7.4 percent on top of the 7.9 percent increase in 2005."

The War on Marriage at a Certain Newspaper in New York...

info@iwf.org (Charlotte Hays) — Tue, 06 Feb 2007 08:33:00 EST

I missed the New York Times latest attack on marriage, but fortunately Thomas Sowell didn't:

"The Times defined 'women' to include females as young as 16 and counted widows, who of course could not be widows unless they had once had a husband. Wives whose husbands were away in the military, or in prison, were also counted among women not living with a husband.

"With such creative definitions, it turned out that 51 percent of 'women' were not living with a husband. That made it 'most' women and created a 'news' story suggesting that these women were not married. In reality, only one fourth of women have never married, even when you count girls as young as 16.

"While the data quoted in the New York Times story were about women who were not living with a husband, there were quotes in the story about women who rejected marriage."

The elite types who work at the Times make enough money and have enough of what used to be called advantages they their kids won't (immediately) be harmed if marriage declines -- but others children, whose parents lack the their habits and discipline of your typical sharp elbowed Timesperson, will. Yes, marriage is in trouble, even without the false statistics making it seem worse, as Kay Hymowitz's "Marriage and Caste in America" shows. But Hymowitz shows that it is the underclass that liberals profess to care about that suffers most when parents aren't married.

Office Queen Bees...

info@iwf.org (Charlotte Hays) — Wed, 03 Jan 2007 07:23:00 EST

There is some bad news for feminists who support affirmative action for women as a way for women to move up in the office hierarchy. According to an article in the Times of London a female boss is rarely a female worker's best chance for promotion:

"Women bosses are significantly more likely than men to discriminate against female employees, research has suggested.

"The study found that when presented with applications for promotion, women were more likely than men to assess the female candidate as less qualified than the male one...."

The findings were based on a recent study with 750 participants:

"'Female and older participants showed more prejudice against the (idea of a) female leader than did male and younger participants,' said Rocio Garcia-Retamero, a psychologist at the Max Planck Institute for Human Development in Berlin and lead author of the report.

"Garcia-Retamaro said the findings showed that many people adopted a stereotypical view that leadership was a masculine notion. '(This) leads to a bias against a female candidate's promotion to a leadership post,' she said.

"Nicola Horlick, the City financier nicknamed 'Superwoman' for combining a demanding job with a large family, said some women looked on other women as a threat and preferred to surround themselves with men.

"'It is called the 'queen bee syndrome,'' she said."

Government is not the answer

info@iwf.org (Allison Kasic) — Mon, 27 Nov 2006 10:16:00 EST

John Stossel had a great column last week arguing that the free market, not government regulation, is the key to providing flexibility, day care, and any other working mom conundrum you can think of. IWF’s upcoming "Women’s Progress" book even gets a shout out.

Many people who call for increased government regulation point to "family friendly" laws in Europe. But Stossel points out that these laws come with a heavy price:

"In Europe, the unemployment rate for women is over 10 percent -- double the rate in the United States. From 1970 to 2003, employment in the United States increased 75 percent, by 58.9 million jobs. Yet in France, Germany and Italy, where many job benefits are mandated, employment grew only 26 percent, by 17.6 million jobs. And many of those new jobs were in government!

"If a woman wants a career and a family, that’s great. But why must government force other people to help her out? Forcing companies to behave in a certain way just limits the marketplace of possibilities.

"Leaving workplace choices to women and employers creates better opportunities for both. The forthcoming book by Michelle Bernard of the Independent Women’s Forum, 'Women’s Progress: How Women Are Wealthier, Healthier and More Independent Than Ever Before' points out that American women have never enjoyed more options or such a high quality of life. From 1997 to 2002, the number of female-owned businesses climbed 20 percent to 6.5 million firms.

"That happened because in America, despite numerous attempts by bureaucrats to kill it, the entrepreneurial spirit lives. Let’s not suffocate it with government rules that will only reduce women’s choices."

Check out the article here.

A Tough Night for the GOP, But Probably Good for Conservatism

Wed, 08 Nov 2006 08:53:00 EST

Last night was rough: I was definitely surprised at the extent of Democratic pickups in the House and the Senate. And there may be some real bad consquences to having Democrats in power. My greatest concerns is that the Democrats will hobble intelligence agencies and hinder the war on terror. I'm also sad to think that the Washington DC voucher program (it’s up for reauthorization next year) may be killed, which means that about 1700 low income students in the nation's capital will likely have to leave their current schools and return to the miserable DC public school system.

That's the bad news, but there is good news in this election too. Republicans are going to have to do some real soul searching and remember why people supported them in the first place. This means returning to first principles, like a belief in limited government, less regulation, fewer government handout programs, a transparent tax code, reformed entitlement programs, and more individual control. When I was on Fox News yesterday, I struggled to come up with any legislative victory from the past two years. It shouldn't be that hard. Republicans in Congress really fell down on their job, beginning with their failure to engage with the President on reforming Social Security. This should have been a no brainer. It should be conservativism 101 to want to transform our broken, tax-and-spend Social Security system into one that is based on savings and investment. Not only is this good policy, but survey research increasingly shows it’s also good politics. Yet the Republican Congress balked, and proved that they were more concerned with avoiding a challenging political conversation than in doing the right thing. That has to change. Republicans need to get back to talking about their vision of an ownership society.

The Democrats didn't win this election so much as the Republicans lost it. The country didn’t embrace a Democratic vision of government and domestic policy: they never even offered one. They put forth a few small time initiatives -- a higher minium wage and more subsidies for student loans -- but never tackled any of the big issues, like Social Security, healthcare or immigration. Many of the big pickups for the Democrats came through candidates that positioned themselves as fiscal conservatives and practically Republicans on many core issues.

Conservatives should take heart. In two years, there is another chance to reclaim Congress. By that point, not only will we we will be able to point to the vacuous Democratic agenda, hopefully, we will have committed conservatives to root for.

Social Security or Social Insecurity?

info@iwf.org (Allison Kasic) — Fri, 20 Oct 2006 11:02:00 EDT

As you'll note if you take a look at the IWF homepage - we've got Social Security on our minds here at IWF. Particularly, much-needed Social Security reform in the form of Personal Retirement Accounts (PRAs).

IWF's Carrie Lukas makes the case for Social Security as an important election issue to consider this November. Why should voters and policymakers act now? Carrie has the answer:

"The problem gets harder to fix with each day that passes. As with any financial problem, it is easier to address immediately than if you wait and let your debts continue to accumulate before taking action. Right now, it is still possible to create a system that allows workers to opt to save a portion of their payroll taxes for their own retirement. It will require an initial investment, but ultimately will create a much more financially stable system. If we wait until Social Security begins running a deficit, it becomes even harder to fix the problem."

Also on the homepage is the latest publication from IWF - Social Insecurity, written by yours truly. IWF has a rich history of showing how women stand to benefit from SS reform. In Social Insecurity, I show how young people stand to benefit. And I tried my best to throw in enough hip-hop and Ashlee Simpson references to keep the masses entertained. Enjoy.

Be a Feminist--and Worry About Becoming a Bag Lady

info@iwf.org (Charlotte Allen) — Thu, 24 Aug 2006 11:31:00 EDT

The Washington Times has this report (hat tip: Wendy McElroy of iFeminists):

"They may have money in their purses and a decent salary, but many women fear they'll lose their income and end up a bag lady, forgotten and destitute.

"A "startling" 90 percent of women say they feel financially insecure, according to a survey of almost 1,925 women released yesterday by Allianz, a Minnesota-based life insurance company."

Interestingly enough, the more money a woman earns, the more she fears being reduced to living off cat food:

"Almost half are troubled by a "tremendous fear of becoming a bag lady" -- 46 percent of women overall, and 48 percent of those with an annual income of more than $100,000."

Now I think I know the root of that problem--and it lies in that word "forgotten." I used to worry about becoming a bag lady, too.

Then something happened: I got married. And my husband and I knew that we weren't just getting married--we were getting married for life. We might argue about this and that, and we might both have irritating habits that drive each other crazy, but there was no chance that over the long haul, we would break our commitment to take care of each other for the rest of our lives. It helped that my husband is a born saver and investor who pointed out to me that I didn't really have to spend my entire salary on clothes. There were these things called IRAs. But even if circumstances had prevented us from putting away a single nickel, we both knew that neither of us would ever let the other starve.

But marriages like ours, marriages of lifelong commitment, are growing rarer these days--thanks to the messages our liberal elites bombard upon both men and women: that marriage is a "patriarchal" institution, that divorces is liberating, that you'll inevitably split up, so why invest much of yourself in your mate? No wonder that generally liberal highly educated and highly paid women are far more prone than their conservative-leaning middle-income sisters to worry about having no one to care for them at the end of their lives.

Here's more from the article:

"Bag lady syndrome is a fear many women share that their financial security could disappear in a heartbeat, leaving them homeless, penniless and destitute," MSN money columnist Jay McDonald wrote in January. "Lily Tomlin, Gloria Steinem, Shirley MacLaine and Katie Couric all admit to having a bag lady in their anxiety closet."

Note the names: Lily Tomlin, Gloria ("A Woman Needs a Man Like a Fish Needs a Bicycle") Steinem, Shirley MacLaine, and so forth. Not exactly a red-state list.