Breaking the Bias: Women in Finance
International Women's Day is a day to reflect and imagine a world free of gender bias, discrimination, and stereotypes. This day allows us to celebrate the achievements of women while also striving for gender parity. According to a recent study by Osler, approximately 23% of executives in the financial services industry in 2021 were women. As a woman in finance myself, I wanted to dig deeper into this topic and uncover the realities for women and their finances. I sat down with Naomi Shumka, Chief Financial Officer (CFO) of Sagium and Kinsted Wealth, to discuss her reality as an executive in the financial services industry and her experiences when it comes to her own family and finances.
Women certainly have unique challenges when it comes to finances. Imagine having a successful career and deciding to take a pause and stay at home with young children. You and your spouse are shopping around for a financial advisor, and the first advisor you talk to finds out you are a stay-at-home mom. While trying to understand your collective situation, the financial advisor directs all questions to your husband, and leaves you out of the conversation. How would you feel if you found yourself in this situation? On the other hand, how would you feel as the advisor if you later found out she was not only an accountant but went on to become a CFO? I uncovered this story during my conversation with Naomi, an experience of hers when she took a career break, that she will never forget. Although the experience with the financial advisor in her story was before her time at Sagium and Kinsted, it is hard to believe that a bias still exists against stay-at-home parents in today's climate and culture.
Women are different when it comes to money. According to a recent report from Merrill Lynch, one of the biggest financial regrets women have is not investing more. This can be due in part to many factors that stack up against women:
1. Women typically live longer & have smaller nest eggs. When it comes to life and career stages such as parenting and caregiving, women are far likelier to take time off from their jobs than men are.
2. Money talk = taboo. For women, talking about money is a strong social taboo. Sixty-one percent of women would rather talk about their own death than about money.
3. Pay and wealth gaps: While the pay gap is well known, the wealth gap is significant. The average single woman has three times less wealth than the average single man. And on top of all that, women typically take on the lioness' share of household needs and caregiving, which leaves little time to dedicate towards income generation.
The good news, is that women have made great strides over the past several decades and have seen considerable gains in personal and financial power. I gained some useful insights into Naomi's experience during our conversation. Described by her colleagues as hard-working, diligent, and compassionate, there is no doubt that a lot of her success comes from her own grit. One of her first jobs was at The Royal Canadian Mint in Winnipeg. During her time there, Naomi had a mentor who helped and supported her and who she is still friends with today. At another firm where she was the only female in a group of eight males, she credits having a supportive boss. Allyship is a powerful tool for improving representation and the working environment.
'Financial wellness' is a popular term used to describe the security one feels with their finances both now and in the future. If financial wellness is one of your goals, start with understanding what financial wellness means to you; what causes you financial stress, and what you can do about it. It is important to know yourself and understand your relationship with money. It is a different experience for all - some find it stressful, while others find it manageable. Talking to a financial advisor that works with your behaviour with money and money coaching may go a long way.
Finding the Right Advisor
Is there someone on your personal financial team that understands you and that you can trust? Your financial advisor should have the proper credentials, but the depth of your advisor's financial knowledge and experience is even more critical. The foremost element of a great financial advisor is someone who has your best interests at heart and asks you about YOUR dreams, YOUR goals, YOUR values & YOUR desired future. That may sound like a lot to ask for, but it should be a non-negotiable for your financial future.
The Financial Wellness Prescription
While the initial part of the financial wellness prescription is to know yourself and have the right advisor and financial team on your side, the second part is to deal with an independent financial firm. The advice and recommendations you receive should be based on your best interests and not limited to the range of products an advisor can offer you. Seek unbiased, independent advice that is customized to you.
At Sagium, our advisors will ask you questions that make you feel valued and understood, which is ultimately the key to a successful, lasting relationship. Connect with one of our Wealth Strategists to find out your personalized prescription for financial wellness.
- Written by Angela Lee, CFP
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1. Diversity among directors and executives in Canada’s financial services sector. (n.d.). Osler, Hoskin & Harcourt LLP. Retrieved March 8, 2022, from https://www.osler.com/en/resources/governance/2020/diversity-among-directors-and-executives-in-canadas-financial-services-sector#:~:text=According%20to%20the%20CBDC%2C%20one
2. Women and Financial Wellness: Beyond the Bottom Line – Age Wave. (n.d.). Agewave.com. Retrieved March 8, 2022, from https://agewave.com/what-we-do/landmark-research-and-consulting/research-studies/women-and-financial-wellness/