Planning Tips to Engage Women

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Carissa Lucreziano, vice-president of financial and investment advice for CIBC

Women have been disproportionately impacted by the Covid-19 pandemic. It’s a fact. In a study by FP Canada, the 2020 financial stress index describes how the pandemic shut down the services sector first. This sector includes areas as education, child care, retail and restaurants, which tend to employ more women than men. When asked in the survey, 47% of women said their level of financial stress has been impacted by Covid-19, compared to only 41% of men.

Upon further investigation, 55% of women admit to having lost sleep over their finances, compared to 46% of men. The survey findings also discovered women more than men tend to wish they saved more, and started saving earlier. Individuals who work with a financial planner are less likely to have financial regrets. That’s where the opportunity is, and that is where we can make an impact.

When working with women during and after this pandemic, we should keep these findings in mind. We need to engage our clients from day one, and set them up for success. Explain why it’s beneficial to start savings as early as possible. Use visuals, charts and make sense of the data. And listen to what your clients are telling you through probing questions about their dreams, priorities and what keeps them up at night.

The magic happens once a client can envision the full benefits of having a plan, and how much of an impact it can have on achieving their goals. Now, when it comes to the regret of not saving more, the key here is to demonstrate the power of having an annual plan. If you build a financial plan for your client and show them the effects of saving more, and how that contributes to reaching their goals, it can help them understand how everything is interconnected.

With more savings, a shorter time horizon may be possible to achieve the desired goal. And with less savings, a longer time horizon may result. Ultimately, the decision is up to your client as to how long they will want to invest or will want to wait. We just have to take the time to present all of the options so they can make an informed decision.

Unfortunately, the pandemic is not over, and the service sector jobs continue to be affected, so it’s important that we work with women to re-evaluate their financial plans through this time. If sources of income have been lost or if other expenses like child care have suddenly become higher, we can help them adjust their financial plan to fit their new situation. Be sure to include any government assistance programs that may be available, as well as anything offered by the financial institution itself.

From the survey findings, we know that women tend to feel more financial stress than men and are more likely to lose sleep over it. We can help address this too. Having a financial plan and putting it into action is extremely impactful, especially during the annual review process. From a client perspective, it is important to make the plan tangible. For example, seeing areas of progress of growing net worth by paying down a mortgage, saving a sizable amount for an emergency fund, or saving towards retirement or future large purchase. Take the time to walk your client through their financial plan and show them how they are netting out.

If there are cash shortfalls, show them the options available to account for those needs. Recognizing the known shortfalls and proactively addressing them can help provide a lot of relief and clarity. When building a financial plan, also include a variety of scenarios that may be causing some worry for your client. Scenarios could include a prolonged loss of income due to the pandemic or child care costs being significantly more than planned.

Through the scenarios, you can demonstrate how their finances may look and what options might be available at that time. That way, if one of the situations were to occur, your client is slightly more prepared for it and knows they have options. The creation of an emergency fund can also be a great safety net, if not already in place.

Lastly, the advisor-client relationship is something that is built over time, rather than in a single sitting. Be sure to schedule regular check-ins with your clients and see how things are going. Not only does it show you care, but it also allows you to address anything in the financial plan that isn’t working, and course correct. And, most importantly, stay connected through life changes that may impact the plan significantly, whether it be positive or negative.