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Why Do Women Earn Less Than Men?

Salary Tips Just for Women

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It's been cited that the average woman makes 12 percent less than a man in a comparable position. This "underearning" can cost a woman hundreds of thousands of dollars over her lifetime, according to financial adviser and author Mikelann R. Valterra's book, "Why Women Earn Less, How to Make What You're Really Worth."

Valterra notes many factors contribute to this including, the "old boys network," "glass ceiling," and gender discrimination, to name a few. However, Valterra maintains these perpetuating obstacles are only part of the problem. Sometimes women themselves contribute to their lower salaries.

This is an important issue because, according to Valterra, 80 to 90 percent of all women will be solely responsible for their own finances at some point in their lives--whether it's through divorce, the death or disability of a spouse or remaining single.

Are you an "underearner"?

If you recognize yourself in any of these scenarios, it's time to take a serious look at what you are worth.

  • You have not had a raise in two years. Still you don't ask for an increase because you don't want to "rock the boat."

  • You find it hard to tell your clients you're raising your fees.

  • You consistently underbill your clients. You're afraid of their reaction if you billed them for all time you actually spent.

  • You put excessive energy into volunteer activities. Volunteer work often makes you feel lucky to have what you have and makes you think maybe you should just be happy with the way things are.

  • You don't market yourself. You don't "toot your own horn" for acknowledgement within your organization or network with contacts outside of your organization. This keeps you from getting the recognition you deserve and the salary to go along with it.

  • There is a solution

    The good news is it doesn't have to be this way. So what can you do? Follow these steps to help put you on the path to greater earnings.

  • Identify your financial needs. Before you set out for a new job or to get that raise, you should have a picture of where you are financially and where you want to be. That means identifying all expenses (including unexpected costs such as car repairs) as well as your annual net income. Most people know their gross annual salary, but how many know how much of that figure they actually get to spend after taxes and benefits contributions?

  • Research your position and personal qualifications within your industry. If your salary does not match other comparable positions, then it's time to negotiate an increase or find a job that will pay you what you deserve.

  • Learn how to negotiate. Men seem to understand the negotiation game more than women do. Negotiation is key to showing that you know what you're worth and committed to getting it. Also, it's wise to always keep a current list of your accomplishments so you have the ammunition you need to back up your salary request.

  • Last Updated: 24/09/2007 - 3:50 PM

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