A common theme that has been occurring in conversation with my female clients lately has been around the need for adjusting their priorities to better support themselves over those around them.
There are many challenges women can face in their lifetime that can impact their wealth journey, more so than their male counterparts. The career glass ceiling, taking a career slowdown or break to raise children or care for loved ones, going through a divorce, or single parent concern for the financial wellbeing of children are all examples.
It can be difficult to navigate these challenges, ensuring there is liquidity available to maintain a standard of living, whilst keeping an eye on saving or retaining funds for long term security. Unfortunately, there seems to be a lack of self-prioritisation amongst women that can impact their wealth journey significantly.
Throughout my career I’ve seen women focus their financial planning around loved ones rather than themselves, and with the rising costs of living and the increase in women’s wealth, this issue is more prominent than ever before. This lack of self-prioritsation is seen all along the wealth journey, from the earlier stages of earning and career development, right through to latter years of retirement.
Sharing household costs
The gender pay gap is still unfortunately apparent with women striving for equal opportunity in their careers. Often in relationships, there is a desire to demonstrate equality where the couple contributes the same level to household spend, despite different levels of earnings.
With equality of outcome sometimes overriding fairness, the result can be that women are denying themselves discretionary spending with the aim to contribute equally to a living arrangement. This results in limited money with which to live meaningfully.
It’s often forgotten that equity is about equal choice and opportunity, not equal outcome. There is more to bring to a partnership than just finances, for example if one person is contributing to raising children and has sacrificed their career development, income and retirement savings to do so.
Raising children
When there are children involved, women can often compromise their financial security by not saving for their own futures. The invisible cost of parenting, in lieu of working, is known as the motherhood penalty as seen more commonly in women.
Similar to the fair sharing of household costs, having an honest conversation about finances being one of many resources can lead to a more balanced strategy for financial security between parents.
Even when children are grown and financially independent, those parents with sizeable wealth may refrain from spending anything that would reduce the asset base. This could be in order to assist children with property purchases or due to the desire to pass everything on as legacy. Focus needs to be brought back to considering their own needs, both now and the future including care costs with which they may not want the burden to fall on their children.
Inheritance and divorce
Complex emotions can come into play when you’re thinking about adjusting your financial priorties. Clients have often come to me demonstrating feeling of unworthiness when they’ve obtained their wealth through lifetime or legacy inheritance, or via a divorce settlement. There can be a lot of guilt around spending inheritance despite there being financial needs and responsibilities to meet. If a divorce settlement occurred after a traumatic split, there can also be a lot of negative feelings attached to those finances too. These types of negative emotions frequently deter people from using their new wealth to properly support themselves.
Grief can also play a big part in that reluctance to prioritise yourself financially. Statistics show[1] that women are living longer than their male spouses, and large transfers of wealth are estimated for women in the coming years. Grieving a loss of a partner, or emotional desire to preserve legacy can also stop good financial prioritisation.
Financial education
Another reason some women may be apprehensive about prioritising their new wealth circumstances may be due to a lack of financial experience. It’s been reported that only 36% of women seek help from a financial planner compared to 46% of men[2], and this could be for a range of reasons; either due to being early in their wealth journey, feeling alienated by the historic reputation of financial services, or perhaps a partner had previously managed the financial affairs of the household. So, there may be a gap where some financial support and education is required for those who are starting a new phase of their life.
Women’s financial empowerment webinar
How we can help
A financial planner can help an individual work on their personal objectives and goals, including what is needed to support them and their family in years to come. Clients are often understandably knee-deep in the day to day of their lives, so can benefit from a third party helping them see the big picture and map out their future.
Having an expert to talk to about finances can not only assist where there is a shortfall in knowledge, but it can also help soundboard and validate discussions such as those of fair expenditure, equality in saving and investing new wealth for financial security.
Financial planners often act as life coaches in the way they make sure a client’s goals are balanced and they prioritise themselves where necessary. This can be providing the tools to allow them ‘permission’ to spend, the confidence to live comfortably or have somebody there to educate, support and ease their mind whenever they need it. Or it can be as simple as reminding them of the importance of looking after yourself, in order to be able to look after those around you.
[1] Human Mortality Database (2024); UN, World Population Prospects (2024) – with minor processing by Our World in Data
[2] Unbiased, Be a woman with a financial plan, 2023
Important Note
The information contained within this document is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.
This article is distributed for educational purposes only and should not be considered financial advice.
If you are unsure about the suitability or otherwise of any product or service, we recommend that you seek professional advice.
The opinions stated in this document are those of the author and do not necessarily represent the view of Progeny and should not be relied upon to make a financial decision.
Information contained herein has been obtained from sources believed to be reliable but is not guaranteed.
