Financial Blog

Men vs. women: who makes the financial decisions?

We all know that men and women tend to think differently about most things in life, and financial decisions are no, ummm, different. A recent study by the worldwide research, learning and development organization LIMRA highlights some of those differences. To nobodys surprise, the study found that men differ from women not only in basic areas of financial planning, but also in the decision-making process.

Apparently, men like to be in charge, especially older men. (Who knew?) Only 46% of surveyed men aged fifty or greater said that they shared financial decisions with their spouse, while women of the same age were more inclusive in the process. 67% of the women surveyed said that they shared financial decision-making responsibilities with their spouse.

Perhaps it would be better to leave the women in charge, and the wealthier you are, the more you should consider that advice. Even though only 30% of women surveyed were the primary financial decision-makers in households that had a total net worth of more than $1 million, when women are the primary decision-makers, they are generally more likely to have undertaken fundamental retirement planning activities.

According to LIMRA, women were more likely to have determined their Social Security benefits (76% to 73% for men), outlined their retirement expenses (57% to 55%), estimated the number of years that their assets will last (41% to 38%), determined the likely health care coverage they would need in retirement (44% to 37%), and created a specific strategy to keep income flowing from their savings during retirement (41% to 34%).

Did men excel at anything? Two areas of financial retirement planning were completed more often by men than by women. Men were more likely to determine what their retirement incomes will be (55% to 53%), and by a wide margin of 60% to 44%, men were more likely to have calculated the amount of investment income and assets they would be able to spend in retirement.

The survey seems to imply that men focus on the revenue, while women focus on expenses. That is another good reason why teamwork and cooperation between spouses makes financial planning better -- the use of complementary skills.

Without spouses cooperating in the process, unpleasant changes and surprises can follow in retirement. A separate survey from Allianz Life Insurance found that 70% of women change financial advisors after their spouses pass away, which is reasonably consistent with men being unwilling to share in the decision-making process. These women have not built up the same trust with the financial advisor.

A formal plan can help the retirement planning process and keep both spouses and advisors on the same track. Unfortunately, formal plans can be few and far between. Across the sexes, only 25% of survey participants who were primary financial decision-makers had a formal retirement plan.

When a formal retirement income plan is present, survey respondents reported better satisfaction with their financial advisors and expressed greater loyalty. 42% of those with a formal plan expressed advisor satisfaction, approximately three times more than those without a plan.

The bottom line: couples should share the financial decisions and make a formal retirement income plan together, using their complementary skills. Doing so will increase your contentment with your financial advisor, and will likely increase your confidence in your retirement plans as well.

Come on, guys. Just admit that you do not have it all under control and can use some spousal assistance. It will be better for everybody once you do.

This article was provided by our partners at

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ASIC launches landmark case against financial planning firm

The Australian Securities and Investments Commission (ASIC) is taking a financial planning company to court, accusing it of failing to act in the best interests of its clients.

The CFP Board Center for Financial Planning Wants To Cure The Feminine Famine Of Planning

The CFP Board Center for Financial Planning is looking for a few good women.

The Certified Financial Planner Board of Standards Inc. Center for Financial Planning on Thursday officially announced its WIN-to-WIN mentoring program, which is designed to draw more women into the financial planning profession and end what the board calls the feminine famine.

In reality, the board is looking for not just a few good women to be CFP professionals, but as many as they can find. Eleanor Blayney, CFP Board consumer advocate, has an ambitious goal for WIN-to-WIN: to see women constitute 30 percent of CFP professionals in five years. The number has stalled at 23 percent for at least a decade.

On corporate boards, it has been shown that a group, in this case women, can have a real influence when they make up 30 percent of the members, Blayney says.

WIN-to-WIN, which is an outgrowth of the CFP Boards Womens Initiative, is part of the CFP Board Center for Financial Planning, a research and advocacy arm of the CFP Board designed to build a diverse professional workforce. WIN-to-WIN has been in the pilot stage for two years, but is now being officially launched as a mentoring outreach program, the CFP Board says.

The first phase is to entice more women to enter the field and complete the CFP certification process. Another goal is to achieve more racial and age diversity among CFP designees, Blayney says, and to involve more top-level academics in the program.

A lot of young people, or people changing careers, are not aware of financial planning as a profession, and there are still a lot of barriers to women entering the profession. A male-dominated profession perpetuates itself, she adds.

The Center for Financial Panning found that a key way to attract more women to the profession and to have them complete the CFP designation is to have mentors help them through the process. Obtaining a CFP designation requires three years of work experience in the financial industry, the completion of education courses, passing an examination and participating in continuing education.

The process of obtaining a CFP designation is long and can be scary. WIN-to-WIN partners a new person with a CFP professional who has been there, Blayney says.

Marguerite M. Cheng, CFP, CEO of Blue Ocean Global Wealth in Louisville, Ken., already has been active as a mentor and in reaching out to the community.

Longevity may alter financial planning

Longevity is a hot topic among financial services firms. Based on the fact that people are living about 30 years longer on average than they did a century ago, several major companies have teamed up with leading research institutions to figure out what these added years may mean for financial planning.A few months ago, I reported on the latest installment of a multi-year study by Bank of America Merrill Lynch and Age Wave on the impact of longer lives on various aspects of retirement living including health, home, family, giving, leisure, work and finances. In my article, Longevity can

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