As a woman with more than 25 years of experience in finance, Ann Senne understands the lifelong importance of math skills. So when her now adult daughter declared in late elementary school that she wasn't good at math, Senne encouraged her to be persistent.
“Math didn't come easy for her. It was challenging. But she worked hard and succeeded. In fact, she had an amazing female AP Calculus teacher who had a huge impact on her," Senne explains.
Research shows girls' confidence in math begins to plummet as early as age nine, according to Rock the Street, Wall Street, a financial and investment literacy program that teaches and empowers high-school girls. That's despite the fact girls' test scores equal those of their male classmates. Meanwhile, two out of three grown women say they know “little to nothing" about finance.
It's concerning, Senne says, not only because these stereotypes limit girls' career opportunities, but because they stand in the way of girls becoming confident and financially savvy women.
That's where parents can step in. “Taking the time to provide children with the skills, tools and resources to make smart financial decisions can make a big impact on their confidence," Senne says.
Here are five steps you can take to raise financially confident girls:
1. Talk openly about finances
Senne's daughter was initially intimidated by math and finances. With exposure to new ideas and discussions, finance is now a topic she enjoys. “Through conversation, she's become interested in the market and is taking economics classes."
Another great option to kick start financial literacy is through educational videos online. Relatable creators use short-form videos and eye-catching graphics to help the next generation understand topics like the power of compounding and investing in the stock market.
Budgeting and financial decision-making don't have to be taboo subjects. Make them a family affair by talking about goals, celebrating when you reach them and talking about how they were achieved. Kids may not understand the details, but they can understand decisions and the impact.
2. Be a good financial role model for girls
Research shows that dads speak to their sons about investing, but not to their daughters, says Rock the Street, Wall Street founder Maura Cunningham. “It's like sex education, but worse, because nobody's talking about it," Cunningham says.
Parents can start by examining their own beliefs and habits about money, including subtle messaging and beliefs around gender roles and financial power.
Senne managed the finances when her kids were young, demonstrating her equal role in financial decision-making. The kids often heard and saw their parents discussing day-to-day spending, major purchases and strategic financial decisions. Senne says, “My hope is that modeling these behaviors provided confidence to both our son and daughter and showed them a method for managing finances as partners."
3. Teach budgeting basics
Senne says budgeting conversations often start with a simple question – “is it a want or a need?" Break it down even further by determining how many weeks of allowance or hours worked at a part-time job would be needed to make the purchase. She says, “Oftentimes if my daughter understands it would take five hours of work to pay for it, she won't buy it."
Kids in elementary school can also learn about spending versus saving if you make it fun and visual. This can be as simple as labeling clear jars for spending, saving and giving. Seeing into the jars helps them see their progress, as well as gaps, once they decide to spend.
As kids get older, Senne encourages parents to talk to them about how to put a plan in place to save for things they want. She also encourages learning about and trying out investing in the stock market. She says parents don't have to be financial wizards, they can set a good example by talking about budgeting, saving, giving and planning for long-term goals. Also, Senne says, never underestimate the power of a spreadsheet as a tried-and-true method in decision making.
4. Encourage inquisitive minds
Inspire girls to ask questions about finances. Senne says, “It's important we encourage girls to ask questions so they don't listen to that little voice in their head that may prevent them from doing so. Much of finance is personal so it's important to help inspire confidence in decision-making by being open to questions."
It's okay if parents don't have all the answers. Senne recommends the book Napkin Finance, which covers topics like retirement, taxes and real estate through fun, one-page illustrations on napkins.
5. Sign her up for a class
Senne's interest in finance started in school. “I took an accounting class in high school and it clicked. I really liked it and pursued it as my major in college." Financial literacy or a personal finance class are also great options. Ideally, high schools would require personal financial management classes as part of their curriculum, but they're often offered as electives. If that's the case, encourage girls to sign up.
When it comes to college, Senne encourages young women to minor in business, no matter their major. She says understanding terminology, along with business and financial concepts, will position young women to have a decision-making seat at the table later in life.
“Finance is an awesome field for girls, you can have a huge impact. If you're passionate about it, pursue it," Senne says.
RBC Wealth Management, a division of RBC Capital Markets, LLC, Member NYSE/FINRA/SIPC.