The costs of being a woman: Why women can’t borrow like men

The (not so) secret costs of being a woman: Borrowing

Illustration by Christine Mi

From the careers they pursue to the haircuts they get, women pay a premium compared to men throughout their financial lives. To make matters worse, society’s expectations for women, such as raising kids and caring for older parents, deal a major blow to their relative lifetime earning power. And while many women have broken through stereotypes to change the way we think about gender and money, barriers remain.

This four-part series looks at the costs of womanhood—many of which may surprise you (or make you steam). Share them with young women and girls you know. It’s time to give the next generation the tools and know-how they need to make the most of their money.

Women are at a disadvantage when it comes to securing the loans they need to achieve life milestones like buying a house. Except when it comes to student loans, that is; women are saddled with a disproportionate share of college debt.

Credit scores

Men tend to have higher credit scores than women, possibly because their higher incomes make it easier to pay bills on time and in full. The gap is largest—15 points—among those 65 and older, according to a 2016 study of 7 million Americans. Does 15 points seem like nothing? It’s not. Just a few points can make a difference in the interest rate a borrower can get.


Women might pay higher interest rates when they buy a home even though they’re not riskier borrowers than men. That’s in part because of their lower incomes. They also tend to shop around less than men do, instead relying on referrals from people they know and ending up with subprime loans. Yet they are less likely than men to default on their mortgages.

Small business loans

Women who own companies are more likely to be denied credit. Unfortunately, this trend feeds on itself. Female entrepreneurs also shy away from applying at all, fearing they’ll be rejected.

Student loans

Women enroll in and graduate from college at higher rates than men, but they also borrow at higher rates, resulting in a disproportionate amount of debt. In fact, of the $1.4 trillion in outstanding student debt, women hold nearly $900 billion—almost two-thirds.

Check out the rest of this four-part series on what it costs women when they earn less, stay healthy, or spend money.

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