Many of us were brought up not to talk about how much money we earn or spend. We’ve been taught to consider this kind of information strictly personal, and that it is crass to discuss such things outside the home. However, while it can be in poor taste to brag or be nosy about money, people do need to be able to discuss financial matters openly in appropriate contexts –and I think we’d agree that the office of your divorce financial advisor is definitely an appropriate context! Yet, over the years I’ve been helping women navigate financially complex divorces, I’ve found that many women are just not comfortable with those conversations.
Fidelity Investments has an obvious interest in helping people talk about their money, and to learn more about women and their finances, the firm recently conducted some research. The 2015 Fidelity Investments Money FIT Women Study surveyed women in age groups from Generation Y to seniors about how they view and address their finances, including obstacles that may hold them back from being more engaged. Here are a few of the key findings from Fidelity’s research:
- The vast majority (80%) of women surveyed say they have refrained from discussing their finances, even with close friends and family. The most common reason cited was “it’s too personal” (56%), followed by “I don’t want those I’m close with to know this information” (35%), “it’s uncomfortable” (32%), and “I was raised not to talk about finances” (27%).
- Only 47% say they would be confident discussing money and investing with a financial professional on their own. (By contrast, 77% would discuss medical issues with a doctor on their own.)
- While 82% are confident managing day-to-day budgeting, their confidence slips when it comes to longer term financial planning. Of those surveyed, 62% are confused about navigating their future financial path.
These findings trouble me for several reasons. First and foremost, women need to be as readily knowledgeable and easily conversant in financial matters as men are. When they’re not, they’re more likely to be taken advantage of at work, in making major purchases and investments, and certainly in divorce.
If you need to increase your comfort level for discussing money, try these strategies:
Hit the books.
There are many excellent resources for women who want to learn more about their finances. If the topic makes you anxious, become educated at your own pace, in a comfortable setting. Are you an independent learner? Get started on the internet, or in your local library. Does the idea of a formal course of study appeal to you? Check into classes at your local community college.
Information is available about every level of investing, real estate, debt management, taxes, and of course, securing your financial future before, during and after divorce. Choose reputable sources, and steer clear of sales pitches disguised as general information.
“Women should feel empowered, not overwhelmed by finances,” Rebecca Wiggins, Executive Director of AFCPE®, told me. “There are many tools and resources available to help educate women about their finances, from websites like NEFE’s Smart About Money and budget programs like Mint and YNAB to workshops and courses taught at a community center, college, or YWCA.”
Don’t expect to become an expert overnight.
Now that you’ve taken a look at what’s available to help you learn about money, the trick is not to become overwhelmed. If you’re paralyzed by the sheer volume of information out there, take a deep breath and a step back! Just commit to both broadening your knowledge over time, and resisting the tendency to be embarrassed at what you don’t know yet.
Like many things, talking about money gets more comfortable the more you do it. Start by simply including financial topics in your conversation. For example, after this year’s Academy Awards ceremony, people were abuzz about Patricia Arquette’s acceptance speech. Her remarks make a perfect springboard for a discussion about wage inequality, which could lead to sharing strategies for asking for a raise at work, a conversation about 401(k) plans, etc.
Subscribing to a financial magazine is an excellent way to practice discussing money matters. There are financial aspects to all current events and trendy topics, and you might find these angles unexpectedly interesting.
Financial matters are part of our lives. It needn’t be awkward to discuss them, and you can do it without sharing personal details socially.
Sit down with a professional.
You will need to share details with professional experts, though. Whatever your circumstances, there are specialists whose job it is to help you. It is an excellent idea to enlist professional guidance to help you manage your financial portfolio. Rebecca Wiggins agrees. “Oftentimes it helps to meet with a professional,” she said. “Accredited Financial Counselors (AFC®) provide unbiased guidance to help clients work through financial challenges, identify financial opportunities, and develop successful strategies for achieving long term goals.”
Keep money in perspective.
Remember that your net worth doesn’t represent your value as a person. Money is definitely important – it gives us security, as well as some of the material things we want in life – but it doesn’t define us.
When you distance your identity and emotions from your money, you’ll find it’s easier to discuss it as you would anything else. In fact, any “taboo” about discussing financial matters, especially in general terms, can begin to seem silly.
The Fidelity study also reports some positives. For example, the overwhelming majority of women surveyed say they want to get more involved in their finances. That’s excellent news. When women commit to improving their financial literacy, the effects go far beyond what they learn about money. Often, it makes for significant improvement in their relationships, as well.
Talking openly about money with your husband, preferably beginning before you are married, will strengthen your partnership. Share your short- and long-term goals, discuss investment risks, and find strategies to meet those goals together. You’ll be building on a foundation of communication and mutual respect.
Whether you choose to be or not, statistics show that, as a woman, you’ll likely be in sole control of your finances at some point in your life. Though you may not divorce, odds are that you’ll outlive your husband. Being comfortable talking about money means you’re better prepared to manage your financial affairs as a single woman, from your spending plan to your retirement plan.
“In today’s society, women wear more hats than ever before – they often balance motherhood, successful careers, and still manage the household. Creating a spending plan can feel overwhelming, but it’s an important step in building a strong financial foundation and instilling lifelong lessons in future generations,” Wiggins concluded.
Reminder: Discussing money isn’t necessarily rude. You don’t have to broadcast information you’d prefer to keep private, and you don’t have to fish for details of your friends’ financial lives.
Legal matters: Being able to discuss money in a straightforward way can save lots of time in your lawyer’s office… and, since every minute of that time gets billed to you, this is one situation in which talking frankly about money will actually save you money!
Hot tip: It might help to consider that talking about money is no different than, say, discussing your plans to build a house, for example. There are settings in which it doesn’t make sense to get much into it –you wouldn’t bog down a social conversation with specifics about the pitch of the roof and the composition of the mortar –but in your architect’s office, you wouldn’t hesitate to delve into the details.
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