No Ceiling

How women are becoming financially independent

by Paula Mogan

As life expectancy for women and divorce increases, eight out of 10 women will end up alone and solely responsible for their finances, according to UBS’s Own Your Worth report.

Over the past 30 years as a CERTIFIED FINANCIAL PLANNER™ professional, I have seen this firsthand. My experience working with single, married, widowed, and divorced women has been that many have not participated in long-term financial decisions, which may leave them ill prepared.

My personal history contributed to my desire to help educate women and support them when unexpected losses occur. As the first born of twelve children, my father worked several jobs and my mother handled all the finances. I was taught at an early age to work, save, and be financially independent. This was unusual for my generation but it led me to the financial services industry where I found I had a passion for working with women and empowering them to take a seat at the money table.

UBS’ research^* found that although many women are responsible for day-to-day household management including bill paying, even the most educated, high achieving women are not participating equally in long-term financial decisions for a variety of reasons. The desire to defer investment decisions to their spouse or partner stems from not knowing enough about finance, not having the time and being happy with their “divide and conquer” approach. Because of this, they may be at a loss and often overwhelmed when the unexpected death of a spouse or a divorce occurs. I have provided guidance and direction for many years to women who find themselves in these heartbreaking situations. When these events occur, it is a life changing time for them. The added pressure of not having a grasp on their total financial picture adds a layer of complexity at a very stressful time in their lives.

How Can Women Own Their Worth?

Learning to be financially independent is an essential skill. Women are living longer—75% of women will be widowed by the age of 56 and 50% of women over 50 will experience a divorce. These are sobering statistics but there are steps that women can take now to begin the journey to financial independence:

Understand your immediate financial picture: Where does your income go? Take stock and account for all outflows, paying close attention to where you are spending, and updating this frequently. Set a budget, determine your fixed vs discretionary expenses and you’ll soon start to understand what you’re working with and how you can set yourself up for your long-term financial goals.

Prepare for the worst: Pay yourself first and automate retirement plans and savings. Pay attention to credit cards, checking and savings accounts, and investment statements.

Find Your Voice: Work with a Financial Advisor/Planner that is patient, empathetic, listens to you and learns what is most important to you. If you are married or in a relationship, share your interest in being more involved in the financial decision making process. Ask that your partner be completely transparent with your overall financial picture. If you have an advisor but don’t attend meetings or calls, ask to be included. You don’t need to be an expert, but it is critical that you have an understanding of every aspect of your financial life. Don’t be afraid to ask questions, it’s your right to understand how and why decisions were made. A good advisor will give you the attention you deserve and respect your interest. If your current advisor isn’t inclusive and doesn’t educate and inform you, consider selecting another.

It’s never too late to get a hold of your finances. If you’re not currently engaging in long-term financial decisions, don’t be hard on yourself—just look to the future. Many women don’t take control of their financial situation because they lack confidence, are in entrenched gender roles, have demanding work and family responsibilities and may just want to keep the peace. A good advisor will understand your goals, passions, and concerns and help demystify the process.

It’s not about how much money you have but making good decisions that will help to grow your finances. With financial independence comes self-reliance and the confidence to be the architect of your financial future.

*UBS Own your worth, 2018.