By Sarah Kelsey

Like many of us, Heather, an executive at an insurance and financial institution, was raised to keep financial discussions in the vault. Her mother and father are in their late-80s and -90s and kept financial matters private. 

Then her mother, the manager of the household finances, had a stroke. Heather was left scrambling to untangle a complex web of puzzle pieces — from powers of attorney impacts to bill payments and bank statements — that needed to come together quickly.

The situation was amplified given that Heather is a longstanding single parent to twins and was in the middle of contemplating a career change. 

“I realized if something were to happen to me, I wanted to make sure everyone was taken care of and the details were communicated to my children,” Heather says. “I had to work with someone to get everything organized.” 

Enter Jamie Keenan, a Wealth Advisor and Portfolio Manager at BMO. Heather was introduced to her through friends at the International Women’s Forum. 

“Heather is an incredibly successful professional who climbed the corporate ladder while raising twins on her own,” says Jamie. “I noticed from the get-go she was very disciplined in her savings and budgeting approach. Despite being diligent, Heather needed advice on how to put the pieces of her financial puzzle together.” Her estate plan was also out of date — something that Jamie says is very common — and it made sense given all of her financial obligations at the time. 

Together, Heather and Jamie worked to “peel back the onion layers” of Heather’s finances. They spoke candidly about what was needed for Heather to feel more organized with managing her money and Jamie asked her questions about what she wanted for her next chapters in life beyond working. From there, they laid the foundation and set a path that would allow Heather to accomplish all she wanted to do smartly and in a financially safe way. 

“We completed a comprehensive financial plan so she could maintain choice, oversight, and independence on a potential career change and her eventual retirement. Our action items were clear and achievable.” 

“My first goal with Heather was to get a sense of her financial situation. We completed a comprehensive financial plan so she could maintain choice, oversight, and independence on a potential career change and her eventual retirement,” says Jamie. “Our action items were clear and achievable.” 

One goal, for example, was for Heather to update her will and powers of attorney. Through seeking advice, listening to alternatives, and creating her financial framework, it showed Heather she could maintain autonomy and get things done. 

Slowly and surely, Heather says she started to feel more confident in her financial plans. She also started to have open discussions with her kids about money and what that meant for them. 

Today, she says she has an annual “meeting” with her twins where she walks them through everything from her assets to her will. She’s also introduced them to Jamie.

“Single women have the autonomy to make their own financial decisions. When you don’t have to worry about a partner who has different spending or savings goals, you can create your own financial destiny. It sounds dreamy, right?” says Jamie. 

The only problem is when her clients put the financial needs of others before their own — which is very common — they tend to shoulder too much. They need to ask for help and do as Heather has done: surround themselves with a solid “board of directors” to guide them through must-have legal and financial documents. Jamie was in full support to work with Heather’s accountant and helped her secure a strong estate lawyer.

“Gather the courage to ask for help and make a business decision like you would anything else. It will give you that peace of mind and alternatives. Why wouldn’t you have someone join your team?”

“Jamie recognized it was hard for me to let go because I was accustomed to making all the decisions as the single point of accountability in our family,” Heather says, adding that it took time, but they eventually built the trust required for her to embrace the financial planning process. “Gather the courage to ask for help and make a business decision like you would anything else. It will give you that peace of mind and alternatives. Why wouldn’t you have someone join your team?”

She adds: “You can’t go back, but I wish I had met Jamie sooner. I wish I had had guidance when I was making money decisions earlier in my career — the tax implications and what things are good investments. I also wish I had changed the status quo and talked more about money with my family.”

Heather says she’s still in chapter one of her financial plan. Her long-term goals include taking care of her elderly parents and being in a position to help her kids with housing. She’d also like to travel, a personal passion.

Looking back on her financial journey, she offers two final bits of advice. 

First, interview a couple different advisors before you settle on one. She knew Jamie was “it” when their convo left her feeling like she “walked into the perfect home while house hunting.” Jamie also asked questions that “provoked some thinking” Heather hadn’t thought of.

Second, it’s never too late to make sense of your finances. “You can do things the ‘right’ way. You need to ask for help — and to be open to support. And you need to start talking openly about your finances with the right people. You can chart your own course.”

By Sarah Kelsey

What do you do when you realize the person managing your company’s finances has been lying to you? Worse yet, what do you do when that person is your spouse and they’ve also been unfaithful?

That’s what happened to Dana, VP of business development at a tech company, on Easter weekend four years ago. Overnight, she became the person responsible for cleaning up a very sticky financial situation — her husband hadn’t filed her business’ taxes for several years, and she owed upwards of six figures to Revenue Canada. She also became the sole provider for two kids.

“It was a long weekend, so I gave myself a few days and allowed myself to cry and drink wine, then I realized I had to get going,” Dana says. “For the first month, I focused on getting my affairs in order: new wills, insurance beneficiaries, etc. Then, I moved to the finances. I met with my accountant and he referred me to John.”

Dana connected with John Sacke, an Investment Advisor and Portfolio Manager with BMO. His focus is on helping women step into their own as money managers.

“Dana had a lot of concerns with respect to paying her bills and keeping current with her finances. She was living with a lot of uncertainty as a result,” John says. “I have numerous clients going through marital discord. The notion of taking baby steps is very important. I told her to expect emotional turbulence.” 

Dana says she and John worked together to figure out a step-by-step plan for her to not only repay the debts she inherited as a result of her marital situation, but also how to ensure she and her kids were taken care of long-term. 

“The way he went about asking me what I wanted to achieve short- and long-term was never patronizing. He helped me build a new strategy for a way forward based on my goals.” 

Today, through the analysis and the work they did as a team, Dana is months away from paying everything she owes in taxes and has been able to provide for both of her kids, helping her daughter achieve her dream of becoming a skateboarder with Team Canada and assisting her son in a big move to New Brunswick with his girlfriend for new jobs. She now has a holistic tax strategy that’s setting her and her family up for success. 

“The way he went about asking me what I wanted to achieve short- and long-term was never patronizing,” she says. “He helped me build a new strategy for a way forward based on my goals.” 

Naturally, that doesn’t mean the process was always easy.

Dana admits to being frustrated over putting too much trust in her ex-husband and for how long it took to reset her finances; John says he had to gently remind her to trust the BMO process — things take time, but they work out.

“First, I always suggest we do a financial plan, which is a core part of my services. Without cost or obligation, it sets out the vulnerabilities in one’s financial tapestry,” says John of the steps he uses when dealing with these kinds of situations and new clients. “Second, I’m a big believer in consolidation, meaning the less accounts one has, the better one can plan a strategy.” Lastly, he counsels clients to take a holistic look at their finances and to think about what that means long-term.

Dana now says she wouldn’t have been able to survive the past few years if she hadn’t been open to accepting help and finding some space to re-evaluate her life.

“Nobody anticipates that this will happen. Taking steps doesn’t make you disloyal — it makes you smart.”

“I don’t think anyone gets married thinking they’ll get divorced. You have a vision and goals and you picture yourselves in rocking chairs on the porch. When that’s taken out from under you, you need to take time to think about what you want,” she says. “When things exploded, I remember sitting there wondering what I wanted. I was so caught up in bills and working and I didn’t take enough time to take a breath and say, ‘this is your new reality. What do you want to do, where do you want to live, work, and do with your personal time?’”

To help, she began journaling, keeping a good journal for her wins and triumphs and a bad one that she now describes as an “outpouring of feelings and raging on paper.” “Both journals allowed me to get things out of my head and helped me remember and celebrate the wins,” Dana says.

Dana says her biggest learning and piece of advice is to get on top of your finances early, regardless of your marital situation. 

“You should know what you need to do in any situation. If you get an inheritance from your parents, keep it in your name because then it doesn’t become co-mingled with your partner’s finances,” she says. “Literacy and knowing your rights in comparison to your obligations is key.” 

She adds: “Nobody anticipates that this will happen. Taking steps doesn’t make you disloyal — it makes you smart. I wish I had taken a better beat and understood things from the outset. But hindsight is what it is. I’m so lucky I am where I am now. I’ve moved on and am looking forward to what’s next.”

It is an undisputed fact that women earn less than men. The gap varies by age, industry, location, and the method by which you measure it, but most estimates fall within a 10 to 25 per cent range — and that number grows for women who are Indigenous, living with a disability, racialized, or newcomers.

What is less clear is why this problem continues to persist. One common explanation is that the blame lies mainly with women themselves, for failing to ask for the compensation they deserve. In their 2003 book, Women Don’t Ask: Negotiation and the Gender Divide, Linda Babcock and Sara Laschever cite a study of recently graduated MBAs from Carnegie Mellon University. Only 7 per cent of the women had attempted to negotiate their starting salary, compared to 57 per cent of the men — resulting in compensation that was nearly $4,000 higher, on average. That amount, invested at a modest return of four per cent, would be worth over $60,000 in 25 years. And that doesn’t account for other increases of income that are negotiated over time.

As this statistic and others like it continue to be shared, what gets critically lost are the systemic explanations behind it: Women are socialized not to self-promote, and are punished when they do so, including when advocating for compensation in the workplace. Plus, more recent research finds that women are now in fact asking for increased compensation about as often as men — except they’re 25 per cent less likely to be successful.  

“These days it seems like there is zero negotiation allowed for new employment,” says Celeste, a network professional based in San Diego, California, who has been in the industry on and off for over 23 years. “Maybe it’s where I am in my career and career search, but it has yet to be presented as a dialogue. More of a take it or leave it.” 

What to ask for, and how to ask for it

Telling women to simply act more like men is not the solution to close the compensation gap. But while we work on the necessary systemic change, women need a better understanding of what to ask for, and how to ask for it. 

Fotini Iconomopoulos is a speaker, trainer, and author of Say Less, Get More: Unconventional Negotiation Techniques to Get What You Want. She has spent more than a decade teaching negotiation and communication skills, including advising clients on getting the compensation they deserve.  

“Both studies and anecdotal evidence show us that women are treated differently when it comes to negotiation, so we need to be more savvy.”

“Both studies and anecdotal evidence show us that women are treated differently when it comes to negotiation, so we need to be more savvy,” says Fotini. “We need to find ways to get creative on compensation as well, because salary is one piece of it — you can’t pay your mortgage except with the money in your bank account — but there are ways you can increase your wealth in addition to salary.” 

She recommends starting with considering your everyday or occasional expenditures that the company can be covering. Things like parking, transportation, and home office expenses, including your Internet and cell phone. When you take income tax into account, you have to earn more than $100 to pay that $100 mobility bill — while your company might be able to take advantage of bulk rates or tax incentives. 

You can also negotiate for education or training funds, from conference allowances to professional certifications to getting your MBA. “There are lots of things from a personal development perspective that will not only help you save money, but also help you to advance your career.” 

Career advancement

From the perspective of future career advancement, there are also non-monetary items to consider that are really important, like your job title. “If you do have to leave this company someday, or if you want to get promoted internally, which job title you are starting from determines your jumping off point,” advises Fotini. She also recommends asking what kind of access you’ll have to interesting projects, and what exposure you’ll have to potential mentors and sponsors. “All of those things are going to help qualitatively and quantitatively to advance your career, and hopefully make you a lot more money a lot faster.” 

Some employers may hesitate to give you the title or salary you’re asking for until they’ve seen you in action. It’s an issue Fotini sees happening more often with women than men — “men are often hired on their potential, women on their proof” — and she recommends countering with a starting bonus. “It’s a great way to bridge the gap, as they don’t have to commit to higher compensation fully.” 

Approach to negotiation

When it comes to your negotiation approach, Fotini says a lot of it is based on gut instinct. “You need to know the person that you’re dealing with, and what the right timing should feel like,” she says, adding that there are some general guidelines to follow if you’re unsure. Some elements, like job titles, might be easier to bring up sooner compared to a benefits package. “It’s very common to have salary be an early part of the conversation, so people shouldn’t be shy about doing that. If they’ve made an offer, or you know they really want you, that’s when it would be appropriate to be talking about all these extra details.”

Depending on your industry, there might be established norms with respect to perks, but consider them a starting point. “As much as I would recommend people do their homework to understand what’s standard in your industry so you’re at least getting the bare minimum — don’t let that limit you in terms of what you should be asking for,” says Fotini. “Just because it’s normal in consulting but not normal in manufacturing doesn’t mean that you can’t ask for it or that you won’t get it.” 

She has similar advice for seniority level. “Usually, the more senior you are, the more extra signing incentives you can get, because you’re going to be leaving behind some serious job security. You have to be thinking of what they can do to minimize some of that risk,” says Fotini. “It’s compensation, it’s starting benefits from the very beginning, versus a trial probation — all things that can add to your bottom line, and may very well be standard costs for the business. They’re more expected in senior roles, but not impossible in junior roles.”

“The greatest resource we have is people. The hiccup with that is, people are very uncomfortable talking about salary.”

Diane has spent two decades in the advertising industry, in Toronto and abroad. It’s common to switch agencies every few years, either to gain experience on new clients or to move up the ladder, so she’s been through the process more than a handful of times. She now approaches each offer as a negotiation, and recognizes that companies have the leeway to bend their own rules, especially when it comes to more senior positions. 

“I’ve asked several times to waive the three-month probationary period to get access to health benefits right away,” says Diane. “And when I started in my current role, it was a standard part of the package to have a car allowance and parking spot — except I don’t drive. So, I negotiated for a metro pass instead.” 

Tailoring the offer to her needs is a tactic she recommends to others. “I always look through to see if there are any benefits I won’t be able to use, and think of what else I can negotiate for in its place,” Diane says. Her savvy comes from experience, but she says she has learned the most about what to ask for and how to succeed at negotiations by talking openly with friends and mentors. It’s the approach that Fotini recommends everyone take. 

“The greatest resource we have is people,” she says. “The hiccup with that is, people are very uncomfortable talking about salary.” To overcome that hurdle, she suggests carefully crafting your questions in more general terms, such as ‘what would you expect someone of my experience level to get in this organisation, or in my industry?’ 

“Without those conversations, I fear that even with Google and Glassdoor and all of those resources, we’re missing a really important piece of the puzzle to get women where they deserve to be,” says Fotini. “There are wonderful people out there who want to see you be successful, so tap into those people, ask great questions, and you won’t be held back by some of those obstacles put in your way.”

For Lydia Potocnik, philanthropic planning is a career as well as a passion. Trained as an Estate Planning lawyer, she began her career working in philanthropy planning for a hospital foundation in Toronto. “That role really allowed me to appreciate the work being done by charitable organizations and the impact donors can have with their wealth,” she says. 

Now, as Head of Estate Planning & Philanthropic Advisory Services with BMO, Lydia says more Canadian women are making plans for philanthropic giving than ever before. Statistically, women tend to be more strategic in their approach to giving, looking for ways to contribute time and money, maintaining meaningful relationships with charities they’re supporting, and using their philanthropy as an opportunity to be a role model for their families. 

In order to account for personal financial needs and wants — both current and in the future — Lydia suggests that women take a more holistic approach to their wealth in order to ensure that their philanthropic goals are met. A good wealth plan, she says, will look at tax planning, wealth protection, estate planning, business succession planning, and philanthropy planning, and every aspect should consider a woman’s values, goals, and concerns. 

To help simplify the process and make sense of philanthropic planning, we sat down with Lydia to discuss. 

Where should a person begin when it comes to philanthropy?  

The best place to start would be to get clear on your values and determine which causes and organizations best align with those. If you decide you want to have an impact with your giving, it’s a good idea to think about what that looks like to you. 

Do you need to have a large amount of wealth in order to be a philanthropist?

No, you don’t need to have a significant amount of wealth to be a philanthropist. This is something you can build toward throughout your lifetime. However, it is important to note the difference between charitable giving and philanthropy. Charitable giving is often a one-time donation made in response to an immediate need, such as shelter or food or medical assistance. These contributions are often emotional or empathetic and provide short term relief — like donating to an emergency response fund. Charitable donors usually don’t enter into a long-term relationship with the organization. 

Philanthropy, on the other hand, is a much more strategic — and personal — undertaking. Instead of focusing on short-term fixes, philanthropy aims to have a long-term, sustainable impact by identifying and addressing the root cause of systemic societal issues — everything from addiction and poverty, to racism and environmental causes. 

What can someone do if they don’t have a significant amount of wealth but still want to begin their philanthropic journey?

There are several things they can do. Even without a significant amount of wealth, you can still make a difference with a charitable organization. I often tell individuals to reach out to the charity and find out what is important to them and what they’re trying to raise funds for. If you direct your giving toward a specific project, then you’ll be able to see the impact of your donation and that’s going to make it a lot more meaningful to you. 

If someone is looking to become more philanthropic and has a larger amount of funds to allocate, what advice would you give them?

I would suggest they meet with a wealth advisor to determine how much they can afford to donate during their lifetime and combine this with their estate planning. By giving some money away while you are alive, you can experience the impact that you are having while also creating a legacy. An advisor can assist you with establishing goals and aligning them to your vision and values by taking a more strategic and long-term approach. They will often include the charitable organizations you want to support in these discussions. 

Why is an advisor recommended? 

An advisor will have experience helping individuals identify their goals and values and will also make educated recommendations as to how you can meet those goals. They’ll also consider your financial ability to make donations while alive and provide advice on the most tax efficient way to do so. 

How important is planning and goal setting for younger women looking to begin their philanthropic journey?

For younger women, we typically recommend they divide their income into three pools: pay yourself (your savings), pay your expenses, and then give money to charity if you can afford to do so. We recommend a similar approach to children as they learn to navigate finances with their first allowance. 

With women, it’s especially important to make sure that your own needs are met. We have found that with Millennials, there’s often a desire to get more involved when it comes to philanthropy. They often like to do things more publicly, get involved in broad-based fundraising initiatives, get their hands dirty, and get involved with the charity rather than just giving money. Boomers tend to be a bit more private and don’t always want to reveal who they are when they give money. Philanthropy looks very different to different demographics. 

Regardless, the one thing that should remain the same is the plan. Having clear financial and giving goals will help you meet them without any added stress. 

Are there any tools that can help women establish philanthropic practices earlier in their careers?

The Donor Advised Fund (DAF) tends to be ‘step one’ for a lot of women before they establish a foundation. The goal of this type of fund is to put in a minimum of $10,000 up front, which is earmarked for charity. 

The whole amount is invested and every year, you decide how much you want to give to a chosen charity. You’ll get a tax receipt for the $10,000 when it’s invested. You can also choose to skip a year of donating if your focus is aggressive investment. When you’re no longer here, you can appoint someone else to take on the fund and continue to support the charities of your choice.

Many of us consider wealth and estate planning as a way to ensure that our family is well taken care of — but with the right plan in place, your money can also go towards causes that are important to you. Having the ability to leave the world just a little bit better is a powerful and very attainable goal, no matter how much money you’re leaving behind. 

Lydia Potocnik, Head of Estate Planning & Philanthropic Advisory Services with BMO, has spent decades working in the field, and uses her expertise to help guide families through the opportunities and strategies that exist to create a legacy that’s meaningful and lasting, with an impact that carries on through generations. She believes that aligning your estate with your personal values and beliefs is an important wealth planning priority. 

If you’d like to support your charitable values beyond your lifetime — passing the torch to the next generation, so to speak — establishing a trust or private foundation allows you to do just that. We asked Lydia to share her advice on getting started. 

Let’s start with a high-level understanding of estate planning. What is the difference between a will and a trust and how do you know when each is needed?

Both wills and trusts are useful estate planning tools that serve different purposes. One main difference is that a will is a legal document that directs who will receive your property at death and appoints a legal representative to carry out your wishes. By contrast, a trust can be used to begin distributing property — which can include cash, investments, artwork, real estate, and more — before death, at death, or afterwards. It is a legal arrangement through which one person who’s called a trustee, which can be a family member, a friend, or a trust company, holds legal title to property for another person who’s called a beneficiary. Depending on who your beneficiaries are and what their financial needs are, most of the time people will create a will that has a trust within it. 

When would someone typically establish a trust?

One reason a person would want to establish a trust is to provide for children under the age of majority — which is 18 or 19 in Canada, depending on the province you live in — by providing  a monthly or annual income. Trusts are also often created to protect the assets a person wishes to leave to someone with special needs to cover medication, medical expenses, or a monthly allowance for example. They can also provide for flexible distribution of assets to beneficiaries who are unable to effectively manage money or can’t be relied on to make sound financial decisions. It’s worth noting that trusts also offer greater privacy than wills because they don’t go through probate and therefore there would not be any public disclosure. In order to determine the best type of trust for your estate goals, consider the age of your beneficiaries, their financial needs, and their ability to manage their inheritance. 

Beyond providing for their families, many people establish trusts to ensure their philanthropic goals are carried out after they’re gone. How does someone go about setting that into action?

Typically, a trust will be in the form of a written, legal document. To set the process in motion it’s best to meet with an estate planning lawyer who will help draft the terms of the trust. While a trust can be used to benefit individual family members, it can also be used to benefit a charity or several charities. To do this, many clients create a private foundation, set up as a trust structure with a trustee managing the money for various charitable organizations. In this format, the charities will get a set amount of money paid out to them each year from the trust. 

Is there a benefit to setting things up this way, rather than just making a large one-time donation to a charity or charities of your choice? 

Most of the time people create a charitable trust or a private foundation as a trust structure because they want to create a legacy and ensure that some of the causes that are important to them when they’re alive will continue on when they’re no longer here. Think of it as a formal structure to give meaning to their wealth. 

A private foundation is established and operated exclusively for charitable giving purposes and can be structured as a trust or a non-share capital corporation. The individual will often be the trustee themselves while they’re still alive and will determine which charities will receive a grant each year and how it will be used. Before the individual passes away, they can appoint another trustee to step in and carry out the terms of the trust and ensure that the trust deed appoints an alternate trustee. In doing so, the charities will continue to receive a financial benefit year after year.

For many, the desire to pass along charitable beliefs and values to their children and grandchildren is important. How can a trust be used to accomplish this?

Establishing a charitable trust or private foundation is a wonderful way to pass on philanthropic values to the next generation. Most of the time, if a trust is created today by parents or grandparents, they will appoint their children or grandchildren to be successor trustees. That way, the family values and the vision to support certain causes — whether it be the environment, mental health, or supporting marginalized groups, for example — will be carried on through future generations with the trust. 

How does the trust work so that there’s always money available to give?

Typically, the money in the trust will be invested by a professional. Someone like a family member can invest the assets, but if you have a professional investment advisor one of the goals may be to grow the capital by investing it prudently and then disperse the annual income. If it’s a private foundation set up as a trust you do have to disperse 3.5% every year to charities in Canada. So, the goal is to make sure you’re generating at least that much income to meet the minimum annual disbursement requirement 

How do families decide on which causes to support and do they have to give to the same charities every year?

To help families through the process, we encourage them to meet as a group and establish a mission statement for their trust or foundation. We guide them through this process by finding out what is important to them as a family and what has impacted their lives. For example, if someone in the family has been impacted by mental health, they may choose to support mental health projects in their community. Families often accept proposals from various charities and then decide as a group which proposals they want to fund with the revenue generated by the trust or foundation. This can change. Often a family will support a specific charity for five years or so, and after that time they’ll reassess whether they want to continue to make grants to that sector or revise and update their mission statement and support another sector. 

How important is planning and goal setting when it comes to estate planning and establishing philanthropic aspirations?

For women who want to make a meaningful impact in their community, the first step is setting goals around what kind of impact you want to make and factor in your own values and what’s important to you. The second step is to meet with a wealth advisor and put a wealth plan in place. 

The wealth plan looks at everything from retirement needs, to tax planning, estate planning, business succession planning, and philanthropic planning. It allows a woman to assess how much money she has today and ask herself: can I afford to start taking a more strategic approach to my philanthropy today or do I need to hold off until I retire, or does it have to happen through my estate plan when I pass away? 

A wealth plan also allows a woman to make a thoughtful decision around philanthropy and what tools she’ll use to meet her goals. You can’t make any decisions until you understand how much wealth you have, who are the other beneficiaries you want to leave money to, and what are your own personal financial needs. It’s important to note that most trusts are irrevocable, so once you transfer assets to a trust, you can’t get that property back out. Therefore, consulting with a tax and legal professional is critical to ensuring that a trust is appropriate based on your own unique personal circumstances.