Financial Wellness Return on Investmentadmin2020-05-03T21:20:12-04:00
Women have it all… “When it comes to financial matters, sometimes women have it all – all of the pressure that is. And not all that much support or guidance.” This is how The Business Journal started an article they wrote about the pressures often facing women breadwinners, Women Breadwinners Bear Brunt, Feel Ill-Prepared.
The reporter went on to say, “As the primary breadwinners in 40% of American families, women are increasingly moving into the driver’s seat when it comes to family finances. They are accustomed to being the “go-to” person for answers in almost every part of their lives.”
We all see examples of the woman who seems to have it all together – juggling all balls successfully. However, as an advisor to MANY highly successful women, I can tell you that this confidence, relative to her successful career and family, often falls short when it comes to navigating financial matters. Forecasting resources needed for college, handling unforeseen career challenges and managing caring for aging parents requires skills and knowledge that are not just inherent in us from the womb – or even developed organically throughout life.
There is no way around it. Keeping all of these balls in the air is not easy.
AICPA Podcast Transcript featuring Paula McMillan, CFP®, CPA/PFS, CGMA
(continued from above):
Successfully navigating these unique challenges women encounter in juggling career and business issues with family finances takes time, knowledge and resources. How can this superwoman continue to find more and more bandwidth beneath her ever-expanding cape?
Behind closed doors, these successful women are often quick to admit to feeling less than confident and under-supported in their personal financial planning capabilities. They have concerns about whether they have adequately planned for future needs.
Both genders often procrastinate when it comes to planning for these important life events, often spending more time annually on vacation planning than financial planning. However, putting these decisions off to another day can exacerbate the ultimate problem, especially for women. Consider a few key related facts:
While 80 percent of men die married, the same percentage of women die single – most often outliving their spouses.
About 95 percent of women will be their family’s principal financial decision-maker at some point in their lives.
Responsible for more than 75 percent of all financial planning responsibilities in their households, female breadwinners spend less than one-tenth as much time and focus on their own personal financial planning as they do on their career or business plan.
Unfortunately, instead of being encouraged by their relatives for taking on these responsibilities related to being the financial leader of the family, many breadwinner women admit to feeling discouraged. In a recent survey, most indicated they felt underappreciated and even resented after often expending great time, energy and money. Why? Traditional social beliefs are often at play, creating even more stress for many breadwinner women. 40 percent of women surveyed felt pressured socially and by family members to keep their breadwinner status private, while 29 percent went on to say that their parents had expressed negative feelings about them being in the role.
Often Breadwinner Women forgo planning for themselves as they age and approach retirement, as a result of this limited perceived support along with time and energy demands. They often end up disengaged from the important planning and conversations until an unforeseen event, like a death or illness of a spouse, divorce or other event, pulls them into the situation – front and center. Suddenly, they are in the middle of a storm trying to make critical decisions with lasting impacts ill-prepared, while still trying to keep projects at work and the household going.
Through prioritizing and delegating, breadwinner women can have it all – the support, the peace of mind and the positive outcomes that come with mapping out a solid, sustainable personal action plan. Encourage her to consider the following ways to take some stress out of the planning:
Create a detailed, robust financial plan. Include scenarios that demonstrate the impacts of various decisions she is considering. Such a plan will provide her with peace of mind and reduce stress.
Be proactive in keeping the work-life conversation with the employer going. Encourage her to be confident and creative in negotiating with her employer over work-life balance issues. Start with what is causing stress The effects of continuous stress and sleep loss are more detrimental than most people realize.
Be intentional or mindful when it comes to understanding personal needs, strengths and challenges, leaning on others within one’s trusted inner circle where it makes sense.
As her advisor, there is a lot we can do to support her in this effort to get some control where there seems to be little. So, what are some of those ways you can help?
Make an effort to know her holistically, demonstrating your understanding of her challenges and more comprehensive support.
Offer her educational opportunities around finance, customized as much to the individual as possible. Recognize that women typically like to be educated and there are often only limited good opportunities for it.
While about 60% of employers are offering some form of financial literacy and education/retirement planning, many women breadwinners feel these approaches are of limited value, preferring a financial planning stipend to hire an advisor offering customized advice.
Keep conversations, communications and other interactions simple, straight-forward and personalized to address her needs. Fully answer her questions, as opposed to generalized advice.
Proactively review all information related to issues you are helping her resolve to deliver an integrated, comprehensive recommendation. The recommendation should explain your rationale in an easily understandable way with a busy and stressed breadwinner woman in mind.
Do not lead with products, if products are even applicable. Lead with her goals, why they are important to her and what’s needed to accomplish them before creating a solution or vision that might ultimately be addressed with a product – if applicable. She wants strategies and tactics that will enable her to accomplish her goals, not to be sold something.
Be her go-to advisor in connecting her with other advisors and resources knowledgeable in specific areas, staying involved throughout her exploration.
Being an advisor worthy of a Breadwinner Woman means not only understanding her and her personal unique challenges and opportunities, you must also be effective in supporting her in her efforts to support those in her inner circle. From being knowledgeable about FAFSA’s in the college planning process, to educating a nephew she is concerned about on investing to understanding the pros and cons of her local Continuing Care Retirement Communities her mother-in-law may be considering, the more you can know, the more indispensable you will be to her. She could sure use someone to help her plan around those balls in the air. Are you prepared to be that someone?
Bio: Paula McMillan, CFP®, CPA/PFS, CGMA
Paula McMillan, CFP®, CPA/PFS, CGMA helps people answer the question “Do I Have Enough?” to achieve and maintain financial independence. She does this through creating detailed financial plans for people and managing their investments for growth. She is a Senior Financial Advisor with Stearns Financial Group.
Paula serves on the AICPA’s Personal Financial Specialist (PFS) Credential and Advanced Personal Financial Planning Conference Committees, the Society for Financial Service Professionals’ Foundation Board and founded and chairs the NCACPA Triad Women’s Initiatives Group and Plenteous Financial Forum. Paula is also an active member of the Greensboro Estate Planning Council and NAPFA.
Paula has been published and quoted in national and local publications, including AICPA’s The TaxAdviser, Kiplinger’s and The Business Journal. She created two national AICPA podcast series on retirement planning and women and wealth. She is a TEDx presenter on the topic of Retirement: Longevity and Security. Paula regularly delivers presentations to national, regional and local audiences on financial life planning related topics.