How do you make a system that wasn’t built for you work?
How do you make a system that wasn’t built for you work?
As Financial Literacy Month is in full swing, conversations, tips and tricks on managing money are being shared, often through a one-size-fits-all lens. The reality is that conversations about money need to be different for women.
Women approach finances uniquely: they make, spend, save and invest differently than men. Historically, banking didn’t include women — we weren’t able to open a bank account or get a mortgage without a male co-signer until 1964. The lack of consideration of women decades ago has left us with a system that doesn’t work in our favour.
The system doesn’t account for the different rewards and challenges unique to women’s life journeys. Women make less than men, pay more for the same products, have different financial risk tolerances and do the majority of unpaid work. We tend to be the primary caregivers for children and aging parents, which affects income and career growth when we take a career break or opt for flexible work options.
Traditional wealth planning doesn’t take these factors into account, and it’s not hard to find financial gender bias: it’s in credit algorithms that don’t consider that women are more likely to have a non-linear income, in retirement calculators that miss the fact that women tend to live longer, and in the bias (conscious and unconscious) we still face by some financial advisors.
While it’s a systemic issue that demands a systemic solution, there’s hope, but it requires us to take charge of our financial future today.
A brighter future
The strides that women have taken to increase financial literacy and success should serve as a reminder that things are changing for the better.
Women’s incomes are growing, and more women feel confident making financial decisions than ever before. Women are increasingly making up more of the workforce, controlling more financial assets and are responsible for the majority of consumer spending — women play a large and important role in controlling wealth.
Taking charge
The time is now to actively shape your financial destiny. Taking charge is not just about understanding your finances today but about making informed decisions for tomorrow — decisions that will affect not only your life but also the generations to come.
Here are a few basics to get you started, no matter your current financial position:
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- Know what you have — and how to grow it. You may already be very involved and knowledgeable about your financial situation, that’s the first step. If you’re not, it’s not too late to start; you have a stake in your family’s finances. Take the first step by gaining a clear view of your household accounts and income (sometimes the ‘household’ part is the most difficult). Having this in one place and reviewing it regularly will give you the perspective you need to make growth-related financial decisions.
- Learn how much money you need to have to maintain your desired lifestyle during retirement. Take into consideration any planned or unforeseen circumstances that may involve you stepping away from work, such as caring for elderly parents or an older spouse. Adapt your wealth-building strategy to ensure you stay on track, regardless of life’s curveballs.
- Talk about money — openly and often. Don’t let money be a taboo topic. Conversations about finances should be as common as discussions about health or career growth. By discussing money, especially with other women, you break down barriers and learn valuable insights. Seek mentors, share experiences and ask questions. Lean on others and learn from their mistakes and successes.
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Owning and acknowledging the financial challenges you face helps create an effective plan to navigate your finances and be better prepared for the uncertainty that will come with it, too.
At Axis, we know that we can all play a role in helping move the needle forward for women’s financial success. We encourage you to do just that by acknowledging the myriad of factors that impact a woman’s financial journey and the disparities we face, celebrating the growth of women’s financial power and creating safer spaces to have more uncomfortable discussions about money.
Are you interested in more conversations about money?