Melanie McDonald is the Vice-President and Regional Director of Trust and Estate Services at BMO Trust Company in Western Canada. As an expert on estate planning, she assists clients with some of the most challenging issues that they and their family will face in their lifetime. She’s also accustomed to handling her own personal and family finances — and believes women should be encouraged more to get involved. As she points out, you don’t need to be a financial expert to feel confident about managing your money.
By Melanie McDonald
More than once, my husband and I have been in meetings with financial advisors who have focused their attention on my husband, and when there are decisions to be made, they ask him to respond, until I say, “Based on my background I take the lead in our family on investment issues, so how you work with us to make investment decisions needs to change.”
It isn’t a surprising situation. The assumption that one person in a couple, often the man, is the one who makes the financial decisions is common — not just in the industry, but outside of it as well, and men are not the only ones to subscribe to this idea. It sometimes comes along with the stereotype that women can’t handle the risk or complexity involved with making financial decisions. I shouldn’t have to explain that this is absolutely untrue — every woman is capable.
And every woman should be capable. Investor Economics projects that the share of wealth controlled by women will grow to $2.7 Trillion by 2024. Whether they are self-made — building wealth from their own businesses and careers — or have inherited wealth, women are an economic force.
So what is holding women back from confidently taking charge of their finances? In my work with hundreds of clients, I’ve identified four myths around women and money that need to be dispelled.
Often people think they need all of the answers before meeting with a financial advisor. But that is exactly what Advisors are there for — to provide not only the options, but information to make an informed decision. Depending on your role models or life experience, you may not currently have the skills to deal with financial issues, but a great advisor will help to educate you and guide you through the experience. Have the confidence to ask questions and learn.
Fully understanding the wide world of investing is a daunting task — and a task that you can leave to professionals. When your advisor listens to your priorities and presents you with options, you can focus your personal research and learning. You’ll be informed enough to make key decisions, without being overwhelmed. A helpful tip for identifying these priorities on your own is to think about your finances not in isolation, but tied to your day-to-day life and major milestones. Ask yourself, “What’s most important to focus on this year?” That’s where you can focus your learning.
There are numerous books and online resources for further educating yourself on specific topics. BMO also offers workshops across Canada for women clients, including seminars for entrepreneurs, becoming more confident in financial life and investing, and dealing with major life events such as divorce or losing a partner.
Seeing your financial advisor shouldn’t feel like going to the dentist. Even beyond this extreme, you shouldn’t settle for someone who isn’t connecting with you, or giving you the advice and support you need. Some advisors tend to focus on their expertise, or what they want to accomplish in a meeting based on what they think the client wants. A great advisor listens and learns, ultimately focusing on the immediate and long-term needs and priorities of their clients. They also understand that the risks of investing can be stressful, and will not only help to make decisions, but will also work with their clients to implement them, make sure they feel right, and make changes if necessary.
If you’ve invested a lot of time and effort with your current advisor you might be reluctant to start the search again, but the relationship is simply too important not to get it right. Your advisor helps you with the foundations of your life, and you could be working with them for years or decades. Make a change if you need to. Or, as I have done, have a frank discussion with your advisor about what you need to have happen to improve the situation.
Thanks to the compounding effect of money, the sooner you budget for investing, the greater the returns — and the peace of mind. Even if your partner is currently handling the finances, there’s likely going to be a point in your life that you are going to be in charge. It’s always better to get comfortable and learn while there’s stability in your life, rather than when there is a significant life change that forces control upon you.
Any myths that are out there should not be barriers stopping from getting your financial and estate planning started or getting more involved in the decision making. It is empowering to take steps to feel more control of your financial wellbeing and your plans for the future. There are many great advisors who are passionate about ensuring that their clients are on the path to success — I encourage you to take one step forward today to get closer to having your financial goals achieved.