Financial Independence for Women: 3 Steps Toward Wealth

This article is an excerpt from the Shortform book guide to "We Should All Be Millionaires" by Rachel Rodgers. Shortform has the world's best summaries and analyses of books you should be reading.

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Are you a woman wanting to become a millionaire? How are you holding yourself back from achieving this status?

Women can be their own worst enemy sometimes. Rachel Rodgers writes in We Should All Be Millionaires that they underestimate their worth and don’t stick up for themselves enough to make more money.

Below is a guide for financial independence for women.

Recognize Your Value and Increase Your Wealth

Rodgers writes that women often underestimate the worth of their work and do more work for less pay than men. So to achieve financial independence, women must overcome imposter syndrome and start charging what they’re really worth. In the following sections, we’ll look at Rodgers’ insights on financial independence for women.

Exploring Factors Behind the Gender Wage Gap

Research shows that the gender wage gap has been relatively unchanged over the past 20 years—women still earn about 82% of what men earn. While Rodgers argues that women work for less pay because they tend to undervalue their work, others write that parenthood norms are behind the pay imbalance. Fathers receive a “fatherhood wage premium,” participating more in the labor force and earning higher pay than men without children.

On the other hand, women who become mothers encounter more disadvantages in the workplace and often work fewer hours. While overcoming imposter syndrome may help many women advocate for themselves, this research suggests we must also shift underlying societal norms and gender roles.

1. Overcome Imposter Syndrome

First, to be able to recognize your value, you must overcome imposter syndrome—the tendency to doubt your skills and abilities and feel undeserving of your accomplishments. If you have impostor syndrome, instead of owning your successes, you might credit them to luck or the efforts of others and feel afraid of being discovered as a fraud.

According to Rodgers, imposter syndrome is a major reason why many women aren’t as wealthy as they should be: It stops them from pursuing more wealth by making them afraid to apply for a promotion, take on tough projects, or start their own business, for instance. Imposter syndrome can also cause stress, anxiety, depression, and low self-esteem, thereby negatively affecting your overall well-being.

To increase your wealth and get the pay and recognition you deserve, you must overcome imposter syndrome. Rodgers provides a few tips on how to do this:

Tip #1: Don’t be hard on yourself for having impostor syndrome. Many successful women have struggled with it, so you’re not alone in feeling doubtful about yourself. Acknowledge your insecurities around your worth and commit to overcoming them.

Tip #2: Write down your achievements, both big and small, as proof of your value. Reviewing your list of accomplishments can remind you that you’re skilled and competent when you feel doubtful.

Tip #3: Seek support. This can mean getting help for your imposter syndrome, like by seeing a therapist or finding a space where you can express yourself and feel understood, like a friend group.

Tip #4: Challenge yourself physically—run a marathon, go scuba diving, learn to ice skate. Doing physical activities that push you beyond your comfort zone can boost your confidence, which can spill over to other areas of your life, like your career.

Tip #5: Reflect on your natural strengths and talents. Think about the skills that came naturally to you as a child or that contributed to your past successes. You can also consider taking a strengths test. Once you’ve identified your strengths, Rodgers suggests you commit to one and focus on creating related products or services that can make you money.

2. Charge What Your Work is Worth

Next, Rodgers argues that you must raise your prices to match the value you produce rather than the hours you work. So, for instance, instead of charging $1,000 because your rate is $50 per hour and you estimate that a project will take 20 hours, think about how much value you’ll bring to the final project and charge that—perhaps $5000.

If you’re an employee with a fixed salary, Rodgers suggests negotiating for a higher salary by explaining how much value you contribute to your company. Determine the value you provide by considering the results of your work—the clients you acquired, the time you saved, and the money you helped your company make.

Rodgers recommends value-based charging because if you charge by the hour, you actually make less money the more experienced you become at your work. This is because as you gain experience, you’ll be able to complete the work more quickly, thereby reducing your income from the project. For example, you might be a freelance artist who charges $20 an hour. As you gain experience and improve your skills, you might finish a project in 10 rather than 20 hours. Despite producing work of higher value, you’ll earn only $200 instead of $400 from the finished piece.

You might realize that your work is worth more than you’re charging for it, but how should you adjust your rates? Rodgers suggests you simply double your price, whether it’s your salary, hourly rate, or the price of your product. She argues that many people produce the same work you produce, but they charge much more. To increase your wealth, simply demand what you deserve and provide high-end results to match. When you increase your rate, your work becomes more valuable. As a result, you make more money and people become more eager to work with you.

3. Challenge Yourself to Make $10,000 in Ten Days

Now that you’ve learned to overcome imposter syndrome and charge what you’re worth, kickstart your wealth-building journey by tackling Rodgers’s challenge to make $10,000 in ten days. This challenge helps you prove to yourself that you’re capable of making more money than you think you can and empowers you to start increasing your wealth now.

Let’s look at Rodgers’s steps on how to do the ten-day challenge:

Step 1: Decide how much money you want to make. While Rodgers suggests you aim for $10,000, you can choose a different target you feel comfortable with. She recommends you estimate how much money you think you can make in ten days and then add 30%.

Step 2: Decide how you’ll reward yourself for reaching your goal. This will help motivate you to go through with your challenge. For example, you might reward yourself with a dream piece of furniture or a vacation.

Step 3: Figure out what you’ll do to make money. Rodgers recommends you choose short-term projects instead of long-term commitments—consider offering a service, selling a product, flipping old furniture, charging for your expertise and advice, or hosting a yard sale.

Step 4: Spread the word to your friends, family, and coworkers about your challenge so that they can encourage you and support your efforts.

Financial Independence for Women: 3 Steps Toward Wealth