How Life Insurance for Women Can Play a Key Role in Financial Wellness

1. What is Financial Wellness?

Let’s talk financial security. 

Whether we’d like to admit it or not, and whether we are comfortable discussing it or not, the state of our finances plays a large role in our overall quality of life.  

Financial wellness can be defined as “the feeling of having financial security and financial freedom of choice, in the present and when considering the future.”¹ 

The impact of financial wellness extends beyond the bank account, for both the good and the bad. When we feel financially well, it is likely that other aspects of our life will improve. Meanwhile, financial stress can lead to various physical and mental symptoms.

To consider yourself financially well, you should be able to: 

1. Be in control of your day-to-day (and month-to-month) finances 

2. Be financially prepared to absorb unexpected expenses 

3. Stay on track to meet long-term goals 

4. Have financial freedom to make choices you enjoy 

Learn more about financial wellness > 

Achieving financial wellness involves budgeting, saving, managing debt, and more to help you avoid the negative effects of financial stress.

2. Why Does Financial Wellness Matter, Specifically for Women?

Women should take special consideration of their financial wellness for several reasons. Let’s look at a few reasons why financial wellness matters specifically for women. 

Gender Pay Gap

Despite ongoing progress, women today still earn less than men. In 2023, women earned $0.83 for every $1 made by their male counterparts, or $11,550 less than the annual median income of men.² With women typically earning less than men throughout their lives, they are at a higher risk for financial insecurity. Women are less likely than men to be able to pay all their bills on time and more likely to rely on credit cards.³ 

While the gender wage gap is narrowing, at this current rate, it would take until 2068 for it to close.  

Life Expectancy

While women can expect to earn less over their lifetimes than men, they can, however, expect to live longer than men. As of 2022, the life expectancy for a U.S. woman was 80.2 years old, compared to 74.8 for men, a difference of 5.4 years.⁴ 

This means that women are likely to outlive their spouses and should consider the financial implications of that. With a longer life comes more years of living expenses. For widows, this could be years — or even decades — of living expenses on a single source of income or savings alone. 

Career Interruptions

Becoming a parent can be incredibly fulfilling. However, balancing the demands of motherhood and the job can have a material impact on women’s careers. 

On average, 24% of new moms exit the labor market.⁵ Even beyond that first year, mothers may find themselves taking career breaks, reducing hours, or foregoing opportunities to prioritize their families. This can all limit potential earnings, retirement contributions, and negatively affect a mother’s financial wellness.

Economic Empowerment

While there are several reasons why women may experience financial strain, there are also reasons to be optimistic. 

By 2030, women are forecasted to be the primary holder of wealth in the United States.⁶ Meanwhile, women continue to take control of their financial wellness and find collaboration with their partners, a significant shift. 

Women will hopefully continue to find economic empowerment, and as they do, a continued focus on financial literacy and maintaining financial wellness will play a key role. 

3. Is Life Insurance Important to Your Financial Plan?

Yes! Having a life insurance policy in place is an important part of any financial plan, helping to secure the financial future for those you love most. 

The death benefit from your life insurance policy can help cover a wide range of things, including: 

• Final expenses: according to the 2024 Cost of Dying Report, the average American family paid $12,616 to handle everything after the death of a loved one.⁷
• Replacing lost income: while most people think about life insurance covering the initial moment of impact, it is important to think about how your family might navigate without your income long-term, and whether you need additional coverage to replace it. 
• Paying off debt: this could include credit card debt, car payments, or mortgages, all expenses that your family would be responsible for in the event of your death.
• College tuition: a life insurance policy can help you leave a financial legacy for your family, with the death benefit helping to cover expenses that are further on the horizon.

Learn more about how life insurance can support your family > 

While most people are uncomfortable talking openly about death, life insurance is a conversation worth having. Getting a life insurance policy in place will help ensure that your loved ones are taken care of, even after you’re gone. 

4. Considerations for Women

In the same way there is a pay gap between men and women, there is also a life insurance coverage gap, as 49% of women reporting having life insurance compared to 55% of men.⁸  

Given the role life insurance plays in financial wellness, and the importance of women specifically thinking through their own finances, here are some additional factors to consider: 

• Covering household contributions: while thinking about the need to replace lost income is more straightforward, a stay-at-home parent’s contributions should also be weighed. According to Investopedia, the salary equivalent of a stay-at-home parent is nearly $205,000 a year.⁹ 
• Living benefits for chronic illness: Chronic pain is becoming increasingly common, with women more likely to experience certain conditions.¹⁰ With Group Term Life Insurance coverage from WAEPA, applicants can add on an optional Chronic Illness Rider, which can help cover the cost of care that chronic illness requires. 
• Protecting your business: According to the National Association of Women Business Owners, more than 14 million business in the U.S. are owned by women.¹¹ A life insurance policy can help provide protection for a business, family, or business partner, paying off debts or keeping the business afloat. 

Learn more about women and life insurance > 

Final Takeaway: Take Control of Your Financial Future

It is important for women to continue to feel empowered and take control of their own finances. Considering the larger systemic and social factors at play, seeking financial wellness for themselves and their families is a critical endeavor. Life insurance can play a key role, helping to safeguard the financial future.

Exclusive Group Term Life Insurance for Feds

Since 1943, WAEPA has offered exclusive Group Term Life Insurance for Civilian Federal Employees. With rates calculated for our entire membership of Feds, rather than individuals, members often save money on premiums, compared to other life insurance policies. Members who switched from FEGLI save an average of $300 per year. 

Use WAEPA’s free premium rate calculator for an instant rate quote. 

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