Women Twice as Likely as Men to Borrow From Family, Friends for Child Expenses
In matters of finance, a gender divide is often clear. In fact, a late 2020 survey found that women were more than twice as likely to borrow from family or friends to cover child-related expenses.
A higher percentage of women also borrowed money from family or friends to cover monthly housing costs and pay off debt.
We’ll look more at child care responsibilities and its impact on finances amid the coronavirus crisis.
Differences in child care responsibilities among women, men
The pandemic has impacted women disproportionately harder than men. This is in part due to the burden of child care and household chores largely falling on working mothers’ shoulders.
A 2020 McKinsey & Co. study found that among dual-career couple households, 22% of women with kids younger than 10 spend an extra five hours or more each day on housework, compared with 10% of men with kids younger than 10.
Women more likely to leave workforce because of child-rearing duties
One in 3 working moms has thought about leaving the workforce or scaling back on their careers because of COVID-19, according to McKinsey, compared with just over 1 in 5 working dads. Among moms considering this shift, many cited taking care of their children as the main reason.
Mothers with young children are more inclined to leave the workforce entirely. Among those surveyed by McKinsey, 23% of women with kids younger than 10 are mulling this move, versus 18% of mothers overall.
And it’s no surprise, but single mothers are hit even harder financially: They’re more likely to handle all the housework, and cite financial insecurity among their main concerns.
Women hit harder economically due to COVID-19
Women suffered greater job losses and higher rates of unemployment than men during the beginning of the pandemic, according to National Bureau of Economic Research data. Between February and April 2020, unemployment rates for women increased by 12.8 percentage points, versus 9.9 percentage points for men.
Indeed, some of the industries that have suffered the greatest blows — including travel, hospitality and restaurants — employ a greater number of women.
Because children were at home as schools and day care centers were closed, many women took on additional responsibilities. In fact, women spent 40% more time caring for children than men, which equated to less time to work and earn a living.
How to protect your finances during the pandemic
If you’ve been negatively impacted by the pandemic, consider the following to protect your finances and credit:
- Seek child care help from your support network, including friends, family, trustworthy neighbors or someone in your pandemic pod.
- Look for government support and resources, such as the Supplemental Nutrition Assistance Program (SNAP) or free meals for children, that could provide financial assistance.
- Teach kids to be self-sufficient (within reason) and have them help around the house.
Taking out a personal loan shouldn’t be your first option if you need to make ends meet, though. You should first call your financial institution to see if they can enroll you in a hardship program.
Tips for shopping for a personal loan
If you don’t want to borrow from family or friends and you’re out of options, a personal loan could be the next option. Explore different lenders to see which ones might be the best fit for your needs and situation.
In some cases, a small personal loan might be your best route. These loans, which are typically $5,000 or less, could be more manageable and quicker to pay off than a more sizable one.
You also need to know what you’re considering — understand what it takes to qualify for a personal loan. Most personal loans come with fixed interest rates and terms between 12 and 60 months.
Methodology: LendingTree commissioned Qualtrics to conduct an online survey of 2,075 Americans, with the sample base proportioned to represent the overall population. Of the total sample size, 719 had borrowed money from a family member or friend within the past year, while 859 had loaned money to a family member or friend during the same time frame. The survey was fielded Nov. 6-11, 2020.