Financial Planning for Women

In honour of Mother’s Day yesterday and all of the great moms out there, I wanted to focus this week’s column on financial planning tips specifically for women.

Historically, men were the primary breadwinners in a family, and many controlled most or all of the finances as well. While this has already significantly changed, it will do so even more soon. It is estimated that by the year 2026, women will officially control 50 per cent of all the wealth in Canada and since they typically live longer, this balance will increase in favour of women even more.

Did you know that 90 per cent of women will become the sole financial decision maker in their lifetime? And did you also know that 60 per cent of women aged 45-54 have no financial plan, in the years they likely need one the most?

Why does that matter? Women’s financial needs, goals and attitudes towards investing are often different from men and they should have a financial plan that is tailored to them. From pay disparity or unique aging considerations, to finding the right professional financial planner, women face distinctive challenges and opportunities when it comes to building and maintaining wealth.

What are some of the unique things that women should be considering for their financial plans?

  1. While women continue to outlive men, they also retire earlier on average which means they need to plan for their retirement nest egg to last longer.
  2. By outliving male spouses, many women will also find that the estate planning process falls solely on themselves as well.
  3. In addition, a jointly owned business may be left in their hands alone to continue running and also sell or pass on when the time is right to retire.
  4. There is often a greater need to plan for the cost of care and disability in their “later years”. For example, 72 per cent of Canadians living with Alzheimer’s disease are women.
  5. You are more likely to end up caring for others. Almost 70 per cent of care provided to older adults is currently done by women.
  6. Many women may find themselves caring for both parents and children at the same time.
  7. Younger women are more likely to have interrupted careers due to children and women of all ages are more likely to have interruptions due to caregiving responsibilities.
  8. Your primary financial goals may be different – studies show a higher amount of importance is placed on things like financial well being of children & grandchildren, overall health, risk tolerance and philanthropy.

While the above list is by no means exhaustive, it shows a small sample of the many unique challenges that females face in managing their finances and creating their financial plans. Everyone’s situation is unique, and a custom-tailored financial plan can address these issues accordingly.

There are many women who feel more comfortable taking about their finances with another woman. If that sounds like you and you don’t have a comprehensive and holistic financial plan, feel free to reach out to me! I know several qualified female financial planning professionals that I trust that I would be more than happy to introduce you to!