In the recently concluded Citi-FT Financial Education Summit I attended an afternoon panel discussion which tackled financial literacy for women at risk. It’s interesting to note that the speakers were both men.
Krzyxzrof Kacsmar (that’s not a typo error, his first name really has only one vowel), the president of Kronenberg Foundation at Citi Handlowly, Poland spoke about the women at risk in his country. Poland is a developed country, which ranks 45th in Gross Domestic Product (GDP) per capita, and 39th in human development. However, one out of three Poland families are reportedly involved in domestic abuse and a staggering 90% of the victims are women. And do you know the main reason for women’s tolerance of the abusive set-up? I’m sure a lot of you guessed it right: Lack of Financial Literacy.
A video was shown to us where women were interviewed about the abuse they undergo and it’s the typical melodramatic stories of wives being abused by their husbands both physically and emotionally. The wives tolerate their situation because they don’t have the financial capability to escape their hellish situation. There were a few women in the audience who were teary eyed after the video presentation. A woman started off the Q & A portion with this remark: “I’m so sad to see these abused women and I’m so happy that I’m not married!” bringing in some needed laughter to lighten up the mood in the conference room.
Kacsmar shared with us that his team is working with women to build financial independence in order to alleviate the situation. They are now putting into law Economic Abuse which is the use of money as a tool to control a member of the family.
This made me wonder, “Does Economic Abuse include the wives of well-to-do husbands kept in the dark about earnings and family wealth, and in so doing are being controlled by their husbands using money?” This again, strengthens my strong belief that all women out there, whether rich or poor, should to be involved in their family finances. Wives, don’t just limit your financial involvement in budgeting household expenses. Know and be involved in what’s happening with your family’s wealth. You don’t only protect yourself from Economic Abuse, but you also protect yourself from the anguish of not knowing where you stand financially and what to do in the case of an untimely death of your spouse. You are not just doing this for yourself but also for your children.
The other speaker was John DaSilva, project manager of Kenan Institute Asia based in Thailand. He said that in Thailand, where GDP per capita is US$4,972, 57% of the population has debt averaging at US$5,524/household. That means that their debt is higher than their annual income! And somehow, whoever borrowed the money, the burden falls on the women. Women in low-income families who are left with the burden of budgeting their measly income are often abused. And guess when the abuse happens? The peak of the abuse happens every payday and it’s because the macho husband usually goes on a drinking spree on payday without regard to the family debt and difficulty of the poor wife in putting food on the table. You can just imagine that when the drunk husband comes home the wife would complain about what’s left from the husband’s paycheck and physical abuse would follow. As you read this article today, the last payday before Christmas, can you imagine how many wives across the world are experiencing this terrible thing right now?
But there is hope as seen in DaSilva’s work with different groups of women at risk. These are the 1.) slum women, 2.) Incarcerated women, 3.) nightlife women. Now this is interesting. After working with these women groups teaching them about budgeting, saving and investing, they exhibited dramatic behavior change. Most of the slum women went out to get a job. Their savings rate shot up from 3% to 90%, except the third group – the nightlife women, even if they started out as having the highest base FQ among the three groups. And the reason: These girls need to show off by buying expensive stuff for themselves. You could say that their jobs require them to dress up but the interviews conducted also showed that they admitted to the need to feel good about themselves and to show proof that they’re earning well.
Come to think of it, this behavior is not limited to “nightlife women.” It’s prevalent everywhere. So the next time you buy that GK bag (I call it GK bag because one piece can build a Gawad Kalinga house, or in some cases, a GK village!), check out your savings rate and your motive for buying. Are you buying it to prove something to others?
(To be continued)
To read part one, click Stories from the 2012 Citi-FT Financial Education Summit.