Single mothers are hardest hit by the gender pay gap
When single mother Lakeesha Brown divorced six years ago, she waived child support and instead shared custody of her two young daughters with her ex-husband.
It was the best decision she made, said Brown, 43, who lives in Farmington, Connecticut with her children, now 8 and 10.
“It was a leap of faith,” she said.
Joint custody enabled Brown to grow her career and income. She is now vice president of human resources at a substance use treatment center.
“I was able to move from a job to something entirely new that gave me the license to be creative, say more and work directly with the CEO,” she said.
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Brown is lucky. While full-time women lag behind men in pay, making 82 cents for every dollar a man makes, mothers are even further behind. Mothers make 75 cents for every dollar paid to fathers and single mothers make 54 cents for every dollar married men make, according to the National Women’s Law Center.
A recent survey shows that custody arrangements have an impact on what single mothers earn. Individuals with a 50/50 parenting schedule are 54% more likely to make at least $ 100,000 a year than those whose children are with them most of the time. This is evident from the survey on income and time sharing for single mothers. In the summer of 2020, 2,270 single mothers were surveyed in the USA.
“There’s a lot of pressure on mothers to be the main parents,” said survey author Emma Johnson, founder of Wealthy Single Mommy, a website for single mothers. “This is our culture.”
Jacalyn Shirley, with two of her three children, had to adjust her work schedule to care for her children.
Jacalyn Shirley, who lives in Ocean Beach, California, has custody of her three children 75% of the time. Shortly after the pandemic, the 36-year-old lost her job with a financial company. When she was offered a job at a bank in June, she said she would have to turn it down for lack of childcare. Their children are 4, 6 and 14 years old.
To meet her children’s planning needs, Shirley started her own mortgage company. She can’t fully focus on it, however, and is earning around 40% of her previous salary.
“If I can work 80% of the time, I can get myself to 80% of that salary,” said Shirley.
Bridging the pay gap is not just about equal pay, but also about finding a fair financial situation for single mothers whenever possible, said certified financial planner Marguerita Cheng, CEO and co-founder of Blue Ocean Global Wealth, based in Gaithersburg , Maryland.
There is a lot of pressure on mothers to be the main parents. This is our culture.
Founder of Wealthy Single Mommy
Ideally, this should be done before the divorce is finalized. However, along the way, negotiations can be conducted on fairer parenting plans that provide flexibility for working mothers. This can give them time to focus on their careers, return to school, take professional development courses, or network.
“Many single mothers may be part-time workers or solo preneurs or freelancers,” said Cheng, a member of the CNBC Financial Advisor Council.
“When a single mother has a full-time job, it’s not just the paycheck she collects, receives, or earns,” she added. “It’s benefits like paid time off.”
This can include other safety nets such as health, disability, and life insurance, as well as a retirement plan.
Parenting flexibility can also give mothers more opportunities to improve their part-time and freelance work.
In addition, Cheng advises single mothers to focus on the long-term rather than the short-term situation when dividing real estate into one.
“What if I hold $ 100,000 worth of stocks versus $ 100,000 in cash?” She said. “How about if I keep the house against retirement plans?”
“That doesn’t mean they shouldn’t keep the house, but understand, ‘Ok, maybe I’ll keep the house for a while,'” added Cheng. “But I have to have a plan and understand the long-term implications of it. ‘”
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