In recent weeks, I have read several articles on the topic of women and their finances and the message could not be more pessimistic. According to these articles, our gender’s future is pretty bleak. Apparently, we cannot be trusted to use our education, career success, or even plain common sense to take care of ourselves. There is a common thread in these articles that emphasizes the following “facts”:
I do not believe this rhetoric. Despite all the statistics ferried by these authors and the interviews with different “experts” in their fields, I find these assertions to be:
These articles are typically sponsored by big financial institutions that benefit from people’s investments in their products. Their conclusions are always the same – invest more money in retirement. It is not coincidental that retirement savings generate the most revenue for these firms.
"Women are smart and ambitious and ready to take charge of their finances."
My take on women’s financial situation is different. I have been fortunate to meet with many women since I started my business and have had many conversations about women’s lives. Most women I meet are:
So what do women need to improve their situation? People in general - not just women, need two things to start fixing their finances: 1) a kick in the butt and 2) the right person or business to guide them.
Most of us live our lives buried in daily responsibilities and there is just not enough hours in the day to take care of everything. We all put off things and only act when something happens. Or we start to really, really want to. In other words, we need a trigger to get us moving. Taking a hard look at your finances and making the necessary sacrifices to fix them is a big undertaking and not for the faint of heart. So what needs to happen to get you going?
Something happens in our lives and we have no choice other than to pick up the phone and call for help. These are usually transition events such as marriage, divorce, layoff, career change, death of a relative, etc. These events are hoisted upon us and we react as best we can. The good news is, we will make changes. The bad news is, it will probably be fast and furious, without the luxury of time to think through all the required decisions in a holistic way.
Motivation is the best internal trigger that takes the place of an external event. It is your brain and your soul urging you to act so persistently that you have to comply. This is by far the better trigger since you will act on your own terms and your own time. If you are internally motivated to fix your finances, you will take the time to learn, get comfortable with the changes, buy into the plan, try a few things until they fit. Motivation will carry you through the entire process and make you devote the time and the energy that it takes to achieve your goals. Motivation is your best friend when it comes to your financial well-being.
"The right person will have their heart in the right place and you will know it."
The truth is, it is not the big financial powerhouses who will set out to help real women with their real, everyday issues and their often modest portfolios. It is the innovative businesses popping up that are bold enough to build their companies the way they think is right. These businesses are not “get rich quick” schemes but are committed to their clients for the long-term - to collaborate and build financial security over time. They work with on a fixed fee arrangement, which allows clients of all ages access to qualified professionals when they need them the most. And they don’t even need to invest your money. Advice is valuable by itself – much more valuable than a mutual fund.
One prerequisite to building a long-term relationship that I find absolutely essential is trust. And no judgement. Because regardless of people’s income and achievements, most of us are pretty queasy when it comes to money. We somehow think that there is an ideal way to do things out there and we have not quite figured it out. The person who will break through this uneasiness and make you feel comfortable is your gal (or guy). The right person will have their heart in the right place and you will know it.
We are men and women but first and foremost we are individuals facing many of life’s challenges. We are much stronger than we think. But even the strongest people need a little help here and there. As long as you are willing to go out there and get what you need, your future is bright.