Having a job, getting a paycheck, putting your money in the bank and controlling how it gets spent: These are basic financial functions that are easy for many women to take for granted in America today. The rights to these functions, however, have been hard-fought and won over hundreds of years.
Here’s a look back at the history of women’s financial independence.
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The 1700s
The status quo for women’s rights that persisted for much of our early history was imported from British colonial law when America was in its infancy. Women in the 1700s were the legal property of their husbands, had no rights of ownership and could not control their own earnings. Outside of marriage, economic survival was virtually impossible.
The 1800s
Colonial economic models based on relatively static land ownership eventually became an awkward fit for a rapidly industrializing capitalist society in which wealth moved quickly.
This worked out in women’s favor.
Bit by bit, states in the 1830s and ’40s began passing married women’s property acts that gave them ownership and control over their own estates and wages.
The Homestead Act of 1862 presented promising opportunities to independent (single, divorced, widowed or deserted) women, allowing more than 100,000 of them to acquire 160 acres of federal land in their own name.
Not only did this raise salient arguments around the exclusion of married women from such opportunities, but as these homesteaders were paying taxes on their land, the outcry against taxation without representation fueled the coming women’s suffrage movement.
Meanwhile, small victories were adding up around the country: California began allowing women to take out loans in 1862. Mary Gage, fed up with having to rely on men to invest her money, opened a women’s-only stock exchange to trade railroad stocks in 1880. The First Women’s Bank of Tennessee opened in 1919, employing and serving women only.
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Early 20th Century
With the right to vote granted in 1920 (though still only to white women), women, at last, had a real voice in the policies and laws that would shape their rights to self-determination.
More significant progress came in 1938 with the Fair Labor Standards Act, which established a minimum wage, affecting many women working low-paying hourly jobs.
The Equal Pay Act of 1963, signed by President John F. Kennedy, amended the Depression-era legislation to address gender-based pay disparity directly by mandating equal pay for equal work.
1970s
The so-called “second wave of feminism” in the 1960s and ’70s expanded wins in legal status matters further into the realms of politics, education, work and more.
Financial independence and the ability to earn a good living are deeply intertwined with access to educational opportunities. Title IX of the education amendments of 1972 addressed this issue, barring any federally-funded educational institutions from discriminating based on sex.
Title IX’s mandate for equal funding of men’s and women’s athletics not only had a major impact on women’s participation in sports programs, but the act is credited with reducing high school dropout rates for girls and increasing the ranks of women earning college degrees.
Two amendments to the Civil Rights Act went further to protect women from gender discrimination. In 1974, Title VII prohibited employers from refusing to hire anyone, fire them or create an atmosphere of harassment based on sex, race, religion or national origin.
In 1978, the Pregnancy Discrimination Act aimed to stop employers from firing women once they became pregnant and ensure that their insurance policies could not exclude pregnant employees.
Amid this wave of legislation came another crucial milestone: ensuring that lenders couldn’t deny credit to anyone based on their sex, marital status, race, national origin or religion. The Equal Credit Opportunity Act of 1974 also prohibits discrimination against applicants who receive federal income assistance.
Modern Times
Recent times have seen more measures to address lingering inequalities.
Just over 30 years ago, women still couldn’t get a business loan without a co-sign from a male relative. That changed with the Women’s Business Ownership Act of 1988.
The Family and Medical Leave Act was enacted in 1993. It entitled workers covered by employer insurance to 12 weeks of paid leave for events such as the birth of a child or to care for an ill family member.
The Lilly Ledbetter Fair Pay Act, signed by President Barack Obama in 2009, relaxed severe restrictions around the statute of limitations over filing an equal pay discrimination suit.
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Where Are We Now?
Although women have come a long way from being considered the legal property of their husbands, many pervasive and deeply ingrained societal issues still present challenging roadblocks to financial independence.
Families with a female head of household have more than twice the poverty rate than those with males (23% versus 11%), according to the 2020 Census.
Despite the Equal Pay Act, women still make 82 cents for every dollar men make, a statistic that can in part be attributed to the higher likelihood that women will interrupt their careers to care for others. The exodus of women from the workforce during the COVID-19 pandemic is expected to negatively affect their wages for years to come.
“Women also have a significant financial literacy gap,” said Lynn Toomey, founder of Her Retirement, a financial education and retirement readiness platform for women. “Family budgeting and personal finance decisions are highly made by women, but women are intimidated by investing.”
Toomey encourages her clients first and foremost to take responsibility for their situations, take steps to educate themselves or seek out help and start putting themselves first. This is especially important, she said, given that women in the U.S. generally outlive men by about five years.
“In some ways, we’ve been conditioned to take care of everyone else. But once that behavior mindset shifts, everything changes,” she said. “Things will be better for everyone around them. They won’t be dependent on their husbands or children later.”
Judy Herbst, executive director of Savvy Ladies, a nonprofit organization focused on women’s financial literacy through a helpline and other services, points out that women often don’t know who to trust when it comes to financial advice, and they’re afraid to ask questions for fear of sounding uneducated.
“Women feel more comfortable working with a female advisor, but only 20% of financial advisors are women,” Herbst said.
Likewise, she said that married women need to have an open dialogue with their spouses.
“Many women don’t have financial transparency in their marriages. It’s important to know where all the money is — how it’s invested, what’s set up for the future,” she said.
Another cultural shift seems to be on the wind.
Sixty-seven percent of women now say they’re investing outside of retirement, up from 44% in 2018, according to a recent Fidelity survey. And millennial women are leading the charge of becoming more engaged in their finances.
“These taboo conversations are starting to come to the forefront,” Herbst said. “Women have always loved talking about sex and relationships, but they don’t talk about money. That’s changing.”
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