Are women ignored by the financial planning industry?

KIM POTGIETER Director and Head: Life Planning, Chartered Wealth Solutions

I always ask new clients about their previous experiences with financial planners, and how it shaped their view of the industry. An astounding number of women are severely dissatisfied with the service received, with the most cited reasons being lack of respect, a one-size-fits-all approach, lack of relationship authenticity and poor communication.

After helping women plan their finances over the last ten years, I have learned that women generally feel talked-down to, pressurised and stereotyped by their planners.

The financial planning industry has traditionally catered for men. Even today, when couples attend planning meetings, men are still the primary source of contact (and the decision makers), leaving women unintentionally side-lined. Yes, women do have a historical disadvantage when it comes to finance; it has been a male-dominated realm and women are less socialised in this arena.

Women are not a homogenous group. We have different life challenges, needs and most certainly different levels of financial knowledge and experience. And things are changing. Although financial planning as a career for women has been slow on the uptake, it is heartening to know that, according to the Financial Planning Institute of South Africa, 30% of certified financial planners entering the profession are women.

According to Stats SA, 62% of children born in the country in 2017 had no details of fathers recorded at birth. This implies that more women are becoming breadwinners and heads of households, making the financial decisions. Women are fast emerging as entrepreneurs, innovators and leaders and they are comfortable prioritising money management, investments and savings.

Unique challenges facing women

Women still earn less than their male counterparts – 23% less according to Stats SA. In general, women have fewer years of earnable income, managing multiple demands such as caring for children and other household responsibilities. A significant challenge when it comes to retirement savings is getting caught in the ‘sandwich-generation’ – simultaneously caring for children and parents. Women are often pressed to decrease working hours, pass up a promotion or negotiate part-time work, which has a significant impact on their savings. Women also live longer than men, and are statistically likely to die single, divorced or widowed.

Women think and talk differently about money

Part of the problem is that the industry has too few female planners. Men are talking to women the way they talk to men, and that’s not working. In general, women behave differently around money – we are not purely interested in potential investment risks, returns and growing assets. We want to talk about our financial decisions and how these choices impact on the people and the world around us. We view money as an enabler of choice; enabling more free time, flexi-hours, and support for our families.

In essence, women integrate life planning with financial planning. We want to discuss how to align the plans we have for our lives with our financial goals, and how our money will enable our dreams. If we are clear on what the money is for, we are generally quite willing to make sacrifices to achieve our goals.

Financial planning for women is about more than just the money. It’s about thrashing out ideas, looking for alternative solutions and creative approaches. Our money needs and goals are unique, and the financial plan must be too.

The challenge for planners is to facilitate money conversations for women in a different way: women value real connections, long-term relationships, listening skills and empathy.

THE FINANCIAL PLANNING INDUSTRY HAS TRADITIONALLY CATERED FOR MEN

How women should choose a financial planner

1. Gender should not be the primary concern when looking for a planner. Women should look for someone who takes an interest in more than their money – someone who understands their financial needs and can align these with their life goals.

2. A woman’s relationship with a financial planner will be a long-term one. Their financial plan will continuously change as their circumstances change. Women should think about how the planner makes them feel: is it someone they can form a close bond with?

3. A good planner will facilitate a life planning session, where women map out their expectations and define their goals. The financial plan is then structured to enable their life plan. Chances are that plans will change – no matter how well prepared they are. The planner must be someone that is trusted enough to have these discussions with.

4. The planner must be a good communicator with essential skills: listening, empathy and authenticity.

5. Knowledge and experience: Women juggle many responsibilities and do not have time to manage their investments on a daily basis – planners should therefore be able to manage finances on their behalf with confidence, make suggestions, and provide feedback.

Women need to empower themselves and take control of their finances. If a woman is in a relationship, she should co-create the family financial plan with her partner, ensuring that it accommodates the wishes of both parties, thereby giving her money the attention it deserves.

Kim Potgieter is the author of Retiremeant – get more meaning from your money and founder of the Women in Finance Network.