Women have more economic power than ever before. In fact, women in Canada control $1.2 trillion in wealth according to StrategyMarketing.ca. And that number is expected to more than double by 2024. Despite women’s growing wealth, though, many women still lack confidence when it comes to managing their money. This discomfort is so strong that 61% of women would rather talk about their own death than about money, as reported by the Motley Fool.
Why is this the case? To get some insight about women and wealth, we spoke with Dilys D’Cruz, Vice President of Wealth at Meridian. This is her perspective on what’s hindering women’s financial confidence and what they can do to nurture their financial wellbeing.
What’s going on with women and wealth?
Women don’t feel heard. Advisors aren’t approaching them, and when they are, they aren’t fostering the right type of connection. Women want to get the information and insight they need to make independent decisions - they don’t want to be told what to do. And most importantly, women want to feel supported and free to be vulnerable and share their fears and hopes. As a result of this advice gap, women feel less prepared for retirement compared to men, and only 27% of women feel financially confident.
What else contributes to a lack of financial confidence?
Well, many women aren’t taking the initiative to find the right advisor or take control of their financial futures. If they’re partnered, perhaps they gave financial responsibility to their spouse. That simple lack of involvement, either by choice or circumstance, affects their confidence. And when women do get involved, they’re often frustrated by not being heard, or not being able to express their thoughts and feelings in an empowering way.
How can women improve their financial well-being?
First, let’s define financial well-being. To me, it means feeling secure about your financial future and making informed choices that allow you to enjoy your life. Financial well-being is a both an element of, and contributor to, your overall mental, emotional and physical well-being. Financial stress can contribute to your general stress and anxiety. Roughly 40% of Canadians cite money as their greatest stress, according to FP Canada’s 2020 Financial Stress Index. And that stress is compounded for women.
What do women want from the financial services industry?
Women want advisors who will hear them, build trust, and connect with them. They want a safe space where they can share hopes, dreams and fears. Unfortunately, we still attach feelings of shame and embarrassment to debt, money problems, and simple lack of knowledge - all of which are actually very common. Combined with the fact that many women feel like advisors talk down to them, this can make it difficult for women to just say “this is where I am right now, how can you help me?”.
This is why it’s so important for advisors to have empathy and understanding and guide women without any judgment or disempowering them.
How has COVID-19 impacted women financially?
Everyone has felt the impact COVID, but the financial impact on women has been significant. The most devastated industries – hospitality, travel and part-time jobs – employ high concentrations of women. About 1.5 million women in Canada lost their jobs in the first two months of the pandemic, according to CBC News. In addition to job loss, women are assuming more of the childcare and homeschooling responsibilities. RBC Economics coined the term ‘Pandemic Shecession’ to describe women’s efforts to balance working and taking care of kids. And it’s clear that many struggle to find that balance.
We’re living through very difficult times, which makes a strong connection with an advisor even more critical. Maybe you’ve lost your job, or had to dip into your savings. With an advisor to guide you, you can restructure your plan to get through these tough times and come out the other side still on track to achieve your goals.
What advice do you have for women who want to better understand their finances and build their confidence?
I come back to the same message – get involved, take control, and start educating yourself. No matter where you are in life – starting out, in the middle of your journey, nearing retirement or already retired – seek the help of an advisor. And work with an advisor that you like, trust, and can be vulnerable with. Interestingly, 80% of women switch advisors within one year after their spouse passes away as they want someone who they can better connect with. Don’t wait for that. If you’re out of school, start working with an advisor now to define your goals and make a plan. If you’re in your 40s or 50s, an advisor can help you with a financial plan to manage competing priorities, like helping older kids with their education, or caring for aging parents.
Your financial situation, along with your short-, medium- and long-term goals, will change throughout your life. Establish a relationship with an advisor who you feel has your back and takes the time to understand you personally as you navigate your life and build your wealth.
How can Meridian help?
We emphasize the personal experience. We get to know our Members, understand what’s important to them and educate them throughout the process. I always talk about creating a safe space for Members, where they can be vulnerable, ask questions, and share their goals and aspirations. By building close, long-term relationships, we help Members feel prepared and confident about their future. They know we have their backs regardless of what happens in their lives, good or bad. Ultimately, we want to help Members move through their financial journey and feel optimistic about their future.