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It-s-Your-Life

It's different for women

Money means many things to people. For some, it’s a way of keeping score, for others it’s the promise of future security. Some yearn for the status that money can bring, while others value it simply for what it buys. 

We all have unique viewpoints about money, which ultimately come from our parents or guardians, the economic environment in which we grew up, our friends and peer groups, and our experiences. For most of us though, it’s a combination of factors.

The management of money is also looked upon through differing lenses, and nowhere is this more apparent than the different ways women and men think about financial advice, investments, and planning.

It’s a well-known fact that women generally live longer than their male counterparts. Combine that with high divorce rates means a greater number of women manage their finances alone. In fact, nearly all women will be solely responsible for their finances, and potentially that of their families, at some point in their lives.

To be clear, whether you are male or female, your investment choices are the same. What differs is the approach to financial management, and your perception of the priorities. 

The old school model meant the husband managed the investment decisions and future planning, while the wife took care of the household and the day to day. This is no longer the case, and you would need to go a long way back to find even a hint of such a reality.

My experience has been that whereas one spouse or the other will be the primary contact, the decisions are generally made on a collaborative basis unique to the couple. When not, it’s often the female partner who takes responsibility for managing the financial process.

In a recent US survey, commissioned by Russell Investments, of Gen X (32-47 years) and Silent Generation (67-80 years) women, the top three concerns about retirement were as follows:

Having enough money for healthcare expenses in retirement

Having enough money to pay for home care or a nursing home

Having to reduce their lifestyle or spending in retirement because of a decline in assets 

While these are issues common to both men and women, there are some marked differences in the priority of the issues, and the way that women will manage them.  

Men tend to be more optimistic about their finances and the markets than women, even when the optimism isn’t warranted. From a planning perspective, women put a greater emphasis on reducing their debts and expenses, and ensuring that they will have enough to live on. 

We men often struggle with accepting help when making decisions, and too often let our egos influence our choices. Women on the other hand, are much more comfortable asking questions and seeking out solutions from others. 

These differences go to the heart of the relationships that women have with their advisors. Women are more collaborative, and put a greater emphasis on detail and being heard and understood. They are generally more realistic about their situations than men.

What does all this mean? It points to a change in the way that financial services will need to be offered if it is to provide effective solutions for the whole market. It’s no longer a one size fits all kind of business. Many advisors have always operated at this level, but for those who haven’t - well, the times, they are a changing. 

Questions or comments: [email protected]

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Jeff Stathopulos, CIM, CFP, Portfolio Manager

Jeff is an advisor and partner with The Navigation Team at Scotia Wealth Management.

He lives in Kelowna with his wife Tanya, their two university bound daughters and their canine kids.

You can contact Jeff by email at [email protected]

Website:  www.yourlifeyourplan.ca

The Navigation Team

Scotia Wealth Management

This column is for information purposes only. It is recommended that individuals consult with their financial advisor before acting on any information contained in this article. The opinions stated are those of the author and not necessarily those of Scotia Capital Inc. or The Bank of Nova Scotia. ScotiaMcLeod is a division of Scotia Capital Inc., Member Canadian Investor Protection Fund.



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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