Financial Wellness 2020: How Women Shoppers Can Beat the Pink Tax

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Products marketed to women are often more expensive than similar products and services for males. From haircuts to medication, gender-based pricing is problematic for female and male consumers alike, and it's costing tens of thousands of dollars over a lifetime.

A report by the Joint Economic Committee of the United States Congress found that women pay:

92% more than men for dry cleaning dress shirts

54% more than men for a haircut

13% more for personal care products

The report contains many instances where the same product, in pink, costs several dollars more than its male-targeted counterpart.  This discrepancy is what is commonly known as the pink tax.

The Pink Tax is Everywhere

The pink tax affects more than ladies who are purchasing products and services for themselves. It affects anyone who is buying a female-targeted item for someone in their life.


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"My wife and I have two boys and a girl," says Roi Tavor, CEO of Nummo, a personal financial management platform and budgeting app. "Since their very first haircuts, my wife and I were having conversations about hairdressers and the massive price difference when it comes to haircuts. Why does it cost so much more for our daughter to get a haircut?"

The pink tax is also sometimes referred to as the "tampon tax," as sanitary pads and tampons, which are considered a necessity for most American women, are subject to sales tax in 35 states due to being considered "luxury items." Necessary products, like medicine and food, are not subject to sales tax.

The New York Times reported that in 2019, 22 states introduced bills to repeal the "tampon tax," but none were signed into law. 

"The tampon tax amounts to sex-based discrimination," Period Equity founder Jennifer Weiss-Wolf told The New York Times. Tennis star Serena Williams added, "A tax on periods is wrong. Telling half the population that their needs aren't important is wrong."

Possible Explanations for The Pink Tax

In some cases, businesses may have a non-discriminatory reason for increasing the price of goods that are marketed to and sold primarily for females. These include:


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Tariffs: There may be higher tariffs for imported goods made for women, which the seller tacks onto the price.

Marketing: The creation of a separate line of products specifically geared toward women can add a hefty price tag to production. These increased production and marketing costs are absorbed into a higher price tag.

Competition: To hold their place in a market where gender-based pricing is prevalent, businesses may not have the option of lowering prices for women's products and still effectively compete.

In some cases, it's simply a matter of price discrimination. Businesses know women (and men) will pay certain prices for certain female-targeted items, so they'll sell them for higher prices.

Why Does the Pink Tax Matter?

The pink tax is a problem that goes beyond the price of the product. Women still only tend to make $0.82 for every $1 earned by men, according to the Institute for Women's Policy Research. For women who are single parents or caregivers for their own parents, they're responsible for paying for products and services for people besides themselves. 


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The pink tax correlates with the widening gender gap regarding poverty. According to the Institute for Policy Studies, 13.4% of women ages 18 to 64 were below the poverty line in 2018, an increase from 10.8% in 1968. In 2018, 9.7% of adult men were below the poverty line. For more than the past 50 years, women have disproportionately been poorer than men, and the numbers are getting worse.

"When there is less money available at the end of the month, it affects the entire family," Tavor says. "The pink tax is a family matter."

What Categories are The Products More Expensive In?

A study by the New York City Department of Consumer Affairs found consumer goods marketed toward women and girls cost about 7% more on average than those marketed toward men and boys. Products for women cost more in 30 out of 35 categories and span every industry. 

The categories where products geared towards girls and females tend to cost more are:

Personal care products: Personal products like shampoo, conditioner, body wash, deodorant, shaving cream, razors and lotions tend to cost 13% more. 

Adult clothing: These tend to cost 8% more.

Senior home/healthcare products: These tend to cost 8% more.

Children's toys: These tend to cost 7% more.

Children's clothing: These tend to cost 4% more.


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Even major expenses, like a home loan, tend to cost more for single females. NBC News reports women have lower credit scores, on average, compared to men. This is likely due to the gender pay gap, which causes women to utilize a bigger portion of the total available credit.

How to Overcome The Pink Tax and be a Savvy Female Shopper 

The pink tax is one form of gender inequality that has been deeply ingrained in American culture and other parts of the world for centuries. Gender inequality issues are continually being addressed by researchers and activists.

It's encouraging when positive action is being taken to address issues like the pink tax. But when change is slow, there are things female shoppers (and shoppers who purchase female-geared items and services) can do in the meantime to offset the pink tax.

1. Research the brands you purchase

If you care where your money is going, research the brands you're purchasing. You can set up Google Alerts for "pink tax," "pink tax company" and "pink tax brand." Whenever news about a company being associated with the pink tax breaks, you'll get an email notification so you can stay up-to-date.

The pink tax hit consumer news in 2019 when Gillette released an ad campaign targeting toxic masculinity. The company was criticized because it charges several dollars more for the same pack of women's razors compared to men's. Staying privvy to news like this can help you make smarter buying decisions.

Also, if you're buying services like haircuts or dry cleaning, talk to providers you're considering about their gender-based pricing practices. Ask for the reasoning in the difference before you decide on a provider.


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"While companies have no incentives to eliminate the pink tax, female consumers have the power of choosing where and at what price they shop, whether it relates to buying a car, getting a mortgage or that next haircut," Tavor says. "Only when vendors feel the 'pinch' will meaningful price reductions occur."

2. Consider unisex products

Going back to razors, if the same job can be done with a male-targeted product or unisex product, purchase that one. It's likely going to be less expensive than the female-targeted product.

"Look at the products you purchase in a different light," says Dawn-Marie Joseph, founder of Estate Planning & Preservation. "Unisex products will do the job and most of the time at a cheaper price."

3. Support companies that are taking a stand

Keep up-to-date with pink tax news so you can learn about new companies that are slashing the pink tax. Soapwalla, for example, is a body product company that creates unisex products, so there's no price discrepancy.

European Wax Center launched a campaign called #AxThePinkTax, where it displays news about the pink tax, companies fighting against it and companies to avoid. Viist the site regularly to see companies taking a stand that you can support. 

4. Be a part of eliminating the pink tax

Awareness is constantly growing about the pink tax, but there is still plenty of work to be done. Start with being more vocal about how you're spending your dollars.

"Bringing the pink tax to light and refusing to let your hard-earned dollars support such companies is the only way this will change," Joseph says. "Get them in the profit center, and sure enough, they will change."

Joseph adds, "Be a smart consumer. You can come right out and ask if the price for you is the same as it is for a man. Tell them you'll pay the same as 'a man' would pay. Try oil change shops, auto dealers, any retail establishments that are mostly staffed by men. It can be a fun game. Remember, it's your money, so be aware."

5. Support legislation to stop the pink tax

You can also get politically active. The website Tax Free. Period. displays a map of the United States, which users can click on to see if their state has a tax on tampons, but not on a non-essential item. For example, Colorado has a tampon tax, but private jet parts are untaxed.

Contact your local government representatives to voice your concerns about women's issues like the tampon tax and the pink tax. Before voting in elections, research the positions of candidates regarding these issues.

In April 2019, California Representative Jackie Speier sponsored the Pink Tax Repeal Act to stop gender-based discrimination when pricing products, the third proposed version of this act since 2016. 

"I think the pink wave that overtook congress in the 2018 elections speaks volumes about how women are stepping up and speaking out," Speier told NBC Los Angeles. "This is a retail issue, this is a pocketbook issue — this is an important issue."

The bill is currently in the first stage of the legislative process and has 51 bipartisan cosponsors. It awaits a potential vote in the House Energy and Commerce Committee. You can contact your local representative to tell them you support the bill.

6. Use credit card rewards to offset the pink tax

Until the pink tax is eliminated, one way to offset the lost money is to use a credit card that rewards you with extra cash back on certain items, including unique bonus categories that might change over time.

You can find a rewards credit card with categories you shop in most, so you're earning more points or cash for what you purchase most often. 

 

*Article reprinted with permission. Original posting can be viewed here: Here's the link: https://www.thesimpledollar.com/financial-wellness/how-women-shoppers-can-beat-the-pink-tax/

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