"In assuming old school, traditional roles when it comes to who is handling family finances with advisers, this could keep women in financially vulnerable positions"
- Mia Kahrimanovic, financial planner at Charles Stanley
Women are much less engaged than men when it comes to conversations with their financial advisers, new research from Charles Stanley has found.
Four fifths (80%) of high-net-worth (HNW) men are actively involved with their financial adviser or family office about their own or their partner’s finances, while just two thirds (67%) of HNW women say the same.
Of this, 57% of men say they are very involved when it comes to conversations about their finances with their adviser, compared to just two fifths (40%) of women. 14% of women also revealed they are not involved in conversations with their financial adviser, while one in five (19%) do not have an adviser at all, raising concerns about the health of women’s finances. In comparison, half the number of men (9%) confirmed they did not have a financial adviser.
The research also showed that men hold the reins when it comes to conversations with advisers when in a partnership. Only 30% of women said they play an active role in having conversations with their adviser about their finances with a spouse or partner, while 42% of men said the same. Men are also more likely to talk to their adviser independently without their partner (25% vs 20%).
With a couple being unbalanced in their involvement with a financial adviser, and possibly unaware of their financial situation, this could result in one partner experiencing financial repercussions if they were to divorce or someone were to pass away.
19% of female divorcees say they wished they were more aware of their financial circumstances when they split from their partner, while 18% said they felt anxious about their finances and didn’t know how they would cope. 14% said they felt overwhelmed and didn’t know how they would manage.
The same is true of those who are widowed. 15% of widows felt anxious about their finances after the loss of their spouse, and 13% felt overwhelmed. Encouragingly, a quarter (24%) said they engaged with a financial adviser to understand their financial situation.
Advisers also have a part to play in ensuring everyone is involved and kept up to date with any decisions or updates regarding their people’s finances. 30% of men say their adviser ensured they were kept in the loop about their financial situation, compared to 22% of women who said the same, potentially widening the vulnerability gap.
Mia Kahrimanovic, financial planner at Charles Stanley, commented: “Women are predicted to be the majority holders of wealth in the years to come, and it’s already suggested that they make better investors due to their patience in the stock market. Yet, this is not reflected in the advice market. Men clearly still take the lead when it comes to having financial conversations with their advisers. Women have made considerable advancements with their finances, but in assuming old school, traditional roles when it comes to who is handling family finances with advisers, this could keep women in financially vulnerable positions, especially in events of separation or death of a partner.
“Couples should strive to have joint conversations with their advisers regarding their finances, and concurrently, advisers should also encourage clients, especially if in a couple, to equally participate in their financial planning. Not only will this instil a more balanced approach, but it will help equip those clients who may be less confident with the tools and guidance to understand their financial positions, both as a pair and individually.”
