April 4, 2017

WTOP Interview: The Impact Of Equal Pay Day On Women And Their Wealth

LISTEN NOW: Women work about 3 months longer than men to earn what they make in 12 months. The impact is significant!
Dawn Doebler, MBA, CPA, CFP®, CDFA®, Senior Wealth Advisor

Interview Transcript:

SHAWN ANDERSON: Women continue to be paid less than men for the same work and to drive that point home, today is Equal Pay Day. Women need to work until today in 2017 to make as much as men did by December 31 of last year.

HILLARY HOWARD: Joining us to talk about the impact of this pay disparity on women and their finances; Dawn Doebler Senior Wealth Advisor at Bridgewater Wealth in Bethesda and cofounder of Her Wealth. Hello Dawn!

DAWN DOEBLER: Hi Hillary!

HILLARY HOWARD: So let’s explore this difference in pay now between men and women and some of the issues that women face because of it.

DAWN DOEBLER: That’s right, well let’s start with some facts. In the US, on average women earn about $.80 per each dollar that a man earns and women have to work about an extra three months into 2017 to make the same amount of money that a man made into 2016. And because many of our benefits are driven off of our wages, the impact is really significant. We have lower Social Security, lower bonuses and lower pensions and one sobering statistic women 75 years and older are nearly twice as likely to live in poverty.

SHAWN ANDERSON: What impact does this have on women especially in retirement?

DAWN DOEBLER: One of the studies showed that the impact of this wage gap over time for women that are working full-time can amount to about half a million dollars in her lifetime and that’s in part because women take time out to take care of their children and increasingly take care of aging relatives. On average women are out of the workforce about 11 ½ years, so this reduced savings means that we're really hit hard in retirement. It is also harder for us to protect our income because many of the values of insurance that our employers provide are driven off of our wages, so it lowers disability income, lowers life insurance.

HILLARY HOWARD: So individually what can women do to try to close that gap?

DAWN DOEBLER: There is a very real wage gap, so we wanted to provide some tips, we have five tips;

1.     Maximize your contributions: If you’re working maximize your contribution to your 401(k), see if you can add to an IRA if you qualify.

2.     If you're not working and you're married you can contribute to a spousal IRA.

3.     If you happen to be freelancing, you may be able to contribute to a SEP IRA.

4.     And we also want to encourage you to focus on education and also coaching your daughters. I have a college-age daughter, so I would encourage you to talk to your daughters about entering areas where they have higher income potential.

5.     And of course focus on education and learn about how to invest your money and continue to build your resume no matter what age you are.

SHAWN ANDERSON: Now, you at Her Wealth you're helping women become more financially prepared; this is a big topic for you give us a couple of examples here?

DAWN DOEBLER: We are very passionate about empowering women, so we’re providing several opportunities to educate women. We certainly have a lot available on our website Bridgewaterwealth.com. We are also encouraging women to engage with us in the conversation about wealth, we're holding events and also doing a lot of speaking engagements.

HILLARY HOWARD: All right, thanks so much Dawn. Dawn Doebler is with Bridgewater

Wealth in Bethesda, you can read more on WTOP.com/search Her Wealth.

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Shawn: Now you hear all kinds of deals about leasing cars, how can you negotiate a better deal if you want to lease?

Nina: Okay, well many people don't realize that they can actually negotiate the sticker price on a leased car in the same way that you would do that if you're buying a car. And since when you lease -- when you're, you know, your lease payments basically cover the depreciation, the difference between the sales price and the residual value. So it's definitely in your best interest to try to reduce that sales price as much as possible because then you'll pay you know, smaller dollars over the life of the lease. Make sure you pay attention to the down payment at the lease signing. And so here's an example, you might see an ad that says you know, lease payment is only 1.99 a month and that sounds like a great deal for thirty six months. The catch is, is that it might require a $3,600 down payment. So, if you amortize the down payment, then actually that 1.99 special, becomes 2.99. So, you really have to kind of look at total costs. 

And then lastly, dealerships use the term, money or lease factor, when they're calculating your financing costs and a lease factor is not the same as an interest rate. So, you have to make sure the dealer converts that lease factor into a comparable interest rate so you know what your financing charges are. 

Shawn: At the end of the day, does one method wind up being more expensive more often than the other, or can we tell that?

Nina: You know what, it really depends on how long, if you're going to hold the car for a long time, you're better off buying. But if you know, and if you're not, if you just really enjoy driving and you want to have a new car, then go ahead and lease. I mean, there's pros and cons to both, to be honest with you, it's not one size fits all.

Shawn: Alright Nina, great. Happy Thanksgiving to you. Alright, Nina Mitchell is with The Colony Group, for more go to wtop.com and search Her Wealth.

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Dawn Doebler, MBA, CPA, CFP®, CDFA®, Senior Wealth Advisor

Dawn’s experience spans more that 25 years providing wealth management, financial planning and corporate finance solutions for clients. As an MBA, CPA, Certified Financial Planner (CFP®), and a Certified Divorce Financial Analyst (CDFA®), she is uniquely qualified to understand the challenges and financial needs of clients from executives to entrepreneurs, as well as single breadwinner parents. Dawn is a weekly contributor to WTOP radio.