Living Longer. Living Well. Helping women make confident financial choices.

facebooktwitterlinkedinby featherolderwoman_decisions_rectangle_webLiving Longer. Living Well. Helping women make confident financial choices.

I can nearly predict what women will say when I tell them I’m a financial advisor. Responses include:

  • I don’t like the financial world
  • I don’t really connect with my financial advisor
  • I don’t have a lot of confidence in making long-term investment decisions
  • I have a network of friends who advise me
  • I rely on my accountant or my husband to take care of our long term investments
  • I’m too busy to think about the financial world of investments
  • I was never good with numbers

The list goes on.

But, the irony is, that women are a growing economic force globally and expected to add about $6 trillion in earned income over the next five years according to research by the Boston Consulting Group. Yet many women lag behind men when it comes to using those assets to plan and build long-term financial security.

Still not convinced that women are a growing force? Here are more factoids.

Women will control 2/3 of the wealth in the US in 10 years. Women will be the beneficiaries of the largest transference of wealth in our country’s history.1 Over 40% of all privately held firms in the US are owned by women.2 Women-owned firms with $10 million or more in annual sales have increased 57% over the last decade.3

Still scratching your head? Here’s more.

Women could soon outpace men as the primary household earners.4

If women are such significant economic contributors, why do they fall behind when it comes to things like financial planning? Journalists have labeled this phenomenon the Female Financial Paradox.

In my household growing up, (and in many other homes) my mom abdicated all the long-term decisions to my dad. Except for when my mom got us evicted from our apartment to force my dad to buy a home, click here, but that’s another story.

So why do women evade financial matters?

Amanda Steinberg, founder and CEO of the website DailyWorth, comments,

“As women, we’ve been socialized to think we’re bad with money, or that engaging with money is somehow ‘unfeminine,’” Ms. Steinberg explained. “It’s ironic that a gender typically so concerned with health, wellness and family security would also be averse to understanding the fundamentals of investing.”

Now add the issue of longevity to this playing field and the matter becomes worse. These days, women live longer: Compared to a female born in 1931, a baby born in 2011 is eight times more likely to live to 100.5

Also, women live on average 5-10 years longer than men.6 Because of this, women will eventually have to start making financial decisions when their husbands pass away, whether they are ready to or not. Bad decisions, can be very expensive financially as well as emotionally for families over multiple generations.

The first step:

Men, share your long-term money decisions with your spouse. Women are already paying bills and bargain shopping like pros. Now it’s time for them to participate in the world of long-term investment and financial planning.

And ladies please, make sure your financial advisor is giving you the respect you deserve. I’m not surprised that most widows fire their financial advisor shortly after their spouse passes away. Probably because the advisor has been neglecting them for years.

Living longer and living well depends on sound financial decisions. Don’t let fears and poor advisors keep you from participating. I hope to write more on this important subject.

 

Footnotes:

1 http://www.mediapost.com/publications/article/197520/us-women-hold-the-purse-strings.html?print

2 http://www.nawbo-mn.org/knowledge-center/wbo-facts/

3 http://www.womenable.com/content/userfiles/Growing_Under_the_Radar_Jan2013.pdf

4 http://www.dailyworth.com/posts/1168-the-female-financial-paradox

5 http://www.theguardian.com/news/datablog/2011/aug/04/live-to-100-likely#data

6 http://content.time.com/time/health/article/0,8599,1827162,00.html

 

Written by Jaimie Blackman

Jaimie Blackman

Jaimie Blackman has created Sound Financial Decisions ™ powered by MoneyCapsules®, to help guide business owners through the complexities of succession planning.

Jaimie writes “Smart Succession”, a monthly column in Music Inc., and also writes a bimonthly column for Canadian Music Trades magazine. He has spoken at NAMM U Idea Center, and at Yamah’s Succession Advantage.

As a financial literacy educator he has taught at New York University and has lectured at the 92nd Street Y, Marymount Manhattan College, and CUNY.

As President of BH Wealth Management, Jaimie also helps his clients implement investment and insurance solutions which are aligned to their personal values. Visit bhwealth.com to learn more.

To subscribe to Jaimie’s Succession Success: Insights for Music Retailers, visit moneycapsules.com.

The purpose of this post is to educate. Our content should not be construed as advice. If legal, tax or other advice is required by the readers, professional advice should be sought.

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