Women have made enormous strides over the last 30 years. There is a consistently closing wage gap between men and women, with more women than men graduating from university. And it’s long been the case that women on average live longer than their male counterparts.
Yet stereotypes persist, of course. And one of those falsehoods includes that men are inherently better at investing compared to women. However, in an interview with Ingrid Macintosh, vice president of wealth and executive sponsor for the TD Wealth for Women program, this myth needs to change, because women will, in all likelihood, be forced into the responsibility eventually.
“We’ve made all these strides,” Macintosh said in an interview with Motley Fool. “But we’re not getting into that investing conversation.
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Women financially responsible, whether they like it or not
In an interview with Macintosh, the expert revealed some staggering numbers surrounding women and investing. Several surveys from TD backed up the claim that, unfortunately. Despite major strides in the workplace and at home, women still aren’t planning for their financial future. What’s more, many women still believe men should be making most financial decisions.
About 60% of women between 45 and 54 were found not to have a wealth plan. Only 43% worked with an advisor at all. Men were twice as likely to be contacted by an advisor compared to women. Yet advisors should be taking note, as about 90% of women will outlive their partners by 10 to 15 years. And 70% to 80% of women will go on to hire a male spouse’s advisor when their husband dies.
And yet even with all these glaring facts, women with husbands still tend to believe they know best when it comes to finances.
“We’re raised to think men know more,” Macintosh said. “Whether they like it or not, women will need to take on this role.”
Myths or excuses
There are many myths or, indeed, excuses that go along with these thought processes, and most stem from how women have been raised. These tend to come down to three thoughts, Macintosh said. First is the thought that women don’t have enough money to be worthy of having a conversation about money. The second is that they don’t have enough time to even think about it. The final one is that they don’t have enough knowledge even to get started.
“We don’t have to be everything,” Macintosh said. “Women feel they need to be perfect at everything or not do it … At any knowledge level, just getting started is the best thing to do.”
And while women might feel that it will take far too much time to get started, Macintosh said this is yet another myth. To get out of this mindset, think of investing as “future self” bill payments, creating monthly amounts that can be paid out automatically. From there, you can simply open your banking application, set a goal, choose a risk profile, and everything else is done for you.
“Thirty years ago, to invest, you probably had to go to a bank and buy GICs [Guaranteed Investment Certificates], or you had a stock broker,” Macintosh said. “Today, it’s already packaged for you. It takes minutes. That’s it.”
“Just start”
Whether it’s just $20 per month, or $2,000, just starting means taking care of that future self — the one that, like it or not, will likely be taking on the majority of financial strains and benefits in the future. So, women certainly should be having their say.
An easy way to get started is to open a Tax-Free Savings Account (TFSA) and consider exchange-traded funds (ETFs) that align with your goals. You could also opt for blue-chip companies that offer dividends, using that income to reinvest.
A strong option is Vanguard FTSE Canada Index ETF (TSX:VCE), which tracks the broad Canadian equity index. Indexes climb over time, allowing for a recovery, even after major dips in the market. And with a 3.31% yield and shares beating the TSX today, it’s certainly a strong long-term option to consider. That’s certainly better than the 0% many women are making today.
“Small decisions made early really add up,” Macintosh said. “We’ve taken control of education; we’ve taken control of our careers … what are we afraid of?”
