According to a national study conducted on behalf of the Financial Planning Standards Council (FPSC), women are significantly more likely than men to lose sleep over financial worries. While the study found that 42 per cent of Canadians (excluding Quebecers) rank money as their greatest stress, 51 per cent of women, versus 40 per cent of men, are more likely to stay awake at night mulling over their financial woes.
Health Canada places long-term stress on issues such as financial problems as a major contributor to adverse health complications. These can range from heart disease to mental health issues. Stress is also a risk factor in alcohol and substance abuse, as well as weight loss and gain. Stress has even been identified as a possible risk factor in Alzheimer’s disease.
According to financial author Kelley Keehn, there’s good reason to believe women are bearing the greater share of these health burdens. Women, she explains, have begun to take the lead in managing household finances.
“Although women have always controlled aspects of family finances, they are forefront more than ever before,” she says. “Women are also earning more, holding an increasing share of jobs and living longer.” (According to research commissioned by Toronto-Dominion Bank, widowed baby boomers outlive their spouses by an average of 16 years.)
This relatively “new” reality brings to light some fundamental differences in the approaches men and women take to financial adversity.
“Women and men are simply different, from their brains to their emotions to why and how they relate,” Ms. Keehn says. “For women, financial planning is inclusive, focused on building and maintaining the family, community and even beyond, well into the future. Men, meanwhile, tend to focus less on relationships and more on shorter-term transactions.”
According to Ms. Keehn, in the face of considerable stress, men release higher doses of adrenaline, activating a “fight or flight” response, while women produce higher levels of oxytocin, activating a “tend and befriend” response. Women’s instincts are to “multitask” their decision-making, taking multiple future outcomes into consideration when making decisions.
So how can women better cope with and ultimately overcome financial stress? Ms. Keehn notes that the financial services sector, where advisors have traditionally focused on men and their money, could do a better job of addressing women’s needs.
“Women report to me that when they have a clear, actionable plan and are respected by their financial professional – and trust him or her – it takes a tremendous amount of pressure and stress out of the equation,” says Ms. Keehn. “Finding the right financial planning professional is an important decision that can affect not only our financial, but also our mental and physical well-being.”
According to the Financial Planning Standards Council (www.fpsc.ca), there are key strategies we can use to ensure we find the right support.
- Be prepared: Become familiar with financial planning terms and strategies. A good financial planner will explain things as you go along, but understanding the basics will help you take greater ownership over the process.
- Know your financial and personal goals: Reflect on what’s most important to you, both today and in the future, so you and your planner can design strategies to get you there.
- Understand fee structures: Ask your planner to tell you how they will be paid for their services upfront. Planners can be paid through the cost of products, a percentage of assets they manage on your behalf and/or a fee-for-service model based on hourly or set fees. Understand how you will pay for services and choose whatever model works best for you.
- Demand competence and ethics: Not all designations in the financial services sector are made equal. The Certified Financial Planner certification represents the gold standard in financial planning, with strict education, experience, competence and an annual commitment to ethics requirements.
- Do your due diligence: Verify a planner’s credentials by contacting their professional body to confirm good standing.
- Know what you are getting: Insist that your planner defines the services they will be providing to you, including any potential conflicts of interest, and that you agree to them.
- Regularly reassess the relationship: Frequent communication is key to a successful relationship with your planner. Make sure your planner understands your needs as they change over time, and have your plan updated accordingly.
“With more and more women at the forefront of financial planning, and reports of money-related stress rising, hiring a qualified financial professional can be like investing in preventative medicine,” says Joan Yudelson, FPSC’s vice president of Professional Practice and a CFP professional herself. “Canadians don’t need to endure the financial stress they’re facing alone. For many, finding help from the right financial professional is the first step toward regaining control over their financial future.”
To find a CERTIFIED FINANCIAL PLANNER professional in your area that will help guide you financially, use our Find Your Planner tool.
For more on calming financial stress and getting started with the right planner, read 5 tips to fight anxiety about money, How financial stress can affect your life and health and 10 questions to ask your planner.
“Canadians don’t need to endure the financial stress they’re facing alone. For many, finding help from the right financial professional is the first step toward regaining control over their financial future.”
BY THE NUMBERS
of Canadian women will have complete control of their household finances at some point in their lives
of women change financial advisors within a year of their partner’s death