Do you have a seat at the table? The financial decision-making table, that is. While the role of women in family financial decision-making, governance and business succession planning has greatly increased, we still have a way to go before reaching parity and full partnership. By taking a few important steps, we can all do our part to make sure our place at the financial table is secure and that we’re creating an atmosphere where both men and women feel empowered to participate in all important financial decisions affecting them and their families.
Step One: The Learning
As a senior leader at Wilmington Trust and a woman who has the privilege of working with families around the world on structuring their financial futures, I get to meet and help some very smart and accomplished people and their families.
That said, there remains a “learning gap” about some of the most important financial matters that women may face during their lifetime (including succession planning) Many of us will outlive our spouse. Some of us will go through a divorce. And more of us are working at senior levels and generating our own wealth.
So, for step one, I thought education was the best place to start.
The approach many families take to discussing financial matters often gets cemented in practice at an early age. Historically, girls were not encouraged to participate in these discussions and, as a result, they missed out on some important lessons at an early age.
In recent years, this has changed significantly – but not in every situation. So, what can we do about it now?
First, parents and other family members will greatly benefit, along with the young women themselves, by encouraging early involvement from those women so they are aware and involved in financial discussions.
Inviting young women to participate in decision-making processes at an early age creates a number of positive outcomes, including:
- It gives them an understanding of, and comfort with, the family’s financial goals and processes.
- It allows them to feel empowered to ask financial questions.
- It gives them permission to test and potentially disrupt long-held beliefs and practices; and
- By understanding their family’s moral compass and financial choices, it gives them permission to have a seat at the table when difficult decisions need to be made.
Step Two: The Help
Once a foundation of education has been established, young women, just like young men, will naturally look for outside influencers to validate and challenge their early assumptions.
Along these same lines, encouraging participation in mentoring and networking programs can help women in similar situations learn to work together in partnership to create and adopt family goals.
Furthermore, this also helps build confidence.
Using the experiences gained by spending time with veterans of our industry and building their own supportive external network, young women will develop confidence to assist in setting and making those family decisions, particularly as generations change places and succession planning becomes more of a factor.
This should also extend to the sources of information they consume.
Let’s face it. The media has not always been an ally to developing women as financial leaders. Women in media have been limited and stereotyped and are often seen as financially dependent on men, lacking knowledge, or uninterested in financial matters, and irresponsibly spending.
As women in the financial services industry, we should be encouraging our younger daughters/sisters/nieces/granddaughters to look for those media outlets that confound those stereotypes.
There are a host of great sources (including the one you’re currently reading, by the way!) that speak directly to women and can be an extremely valuable tool for them.
More women are taking financial leadership roles and the myth that women are less capable of managing money is waning. But again, more work needs to be done.
Step Three: The Pros
Lastly, after availing themselves of resources in the mentoring, networking and media channels, women will also feel more empowered to bring on professional help to manage their and their families’ financial matters.
A financial advisor can be an invaluable resource in helping make the important financial and investment decisions that lie ahead for a woman and her family.
This is especially helpful when making generational decisions, including having difficult and complicated decisions about family businesses and succession planning.
One of the most important advantages to partnering with advisors is their ability to help create and implement a financial plan where people can prioritize goals and define effective investment strategies that are designed to achieve those goals.
The Bottom Line
These three steps are just the starting points for creating true financial partnerships between men and women and empowering women to make decisions that will allow them to enjoy solid financial futures.
But, by taking them, we can best position the next generation of financial decision makers to include equal representation from our daughters and our sons.
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