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The Financial Future Is Female

Women control 32% of the world’s wealth and that number is growing.

Much of what I learned about work and about money, I learned from the women in my life. I’ve seen it written in the financial press that the female investor is the future. Women (and women investors) have always been a strong, albeit less acknowledged, backbone in our society. Demographic trends show though, that there are many reasons for women to be more actively involved in financial decisions. 

Over the past 20 years, I’ve worked with many women and had a chance to see how often responsibilities fall on them, whether they wanted those responsibilities or not. Over the past five years, these facts have hit home for me, literally, in a profound way in how they’ve affected my wife, my mom and my grandmother. 

When I met my wife in 2014, she was a single mom. Before I met her, she’d already served as her dad’s caregiver (he was 60 when she was born) and executor of his estate while also finishing college and raising a toddler. She got married while in college in 2002, and even began a successful career in television after she graduated. In 2012, she and her husband, who controlled most of the finances, divorced. So, she started over, determined to control her own financial destiny, starting from scratch.

Before she retired, my mom was a kindergarten teacher. My dad had multiple sclerosis from the time I was born, so my mom wasn’t just the primary wage earner, she was also the carrier of our family’s health insurance, which was critical. She taught school for more than 30 years, built up a pension and always saved a little extra for a rainy day. 

My mom raised my brother and me almost single-handedly and took care of my dad while also working full time. She retired in 2004, and wanted to spend more time helping to care for my first-born son while I built my career. My mom paid her dues and set out for a stable, secure retirement. 

When I got the call in 2016 letting me know that my parents were getting divorced after 42 years of marriage, I was dumbfounded. My mom is one of the strongest women I’ve ever known. In over 40 years I’d rarely seen anything shake her, but the divorce did. My dad handled almost all the finances, except for my mom’s “extra savings” that she used for my brother and me. My dad paid most of the bills, did the taxes, oversaw the investments and never really included her in financial decisions.

At 66 years old, after 46 years of marriage, my mom started over. She had to buy a house, create an entire household budget, set up all new banking and investment accounts, and obviously make changes to her estate plan and beneficiaries. Even with a son who is a financial advisor, and another who has a PhD in economics, this was all new to her. 

My grandparents were married for 67 years. They had a wonderful marriage, but it definitely followed “old school” gender roles.  When my grandmother started demonstrating signs of dementia several years ago, my granddad literally didn’t know how to do the laundry. 

My granddad struggled with taking care of my grandmother for almost a year in their home,  before he began seriously considering transitioning to a long-term care facility. My mom and aunt did everything they could to facilitate a change, believing it would be best for both of my grandparents to transition together, particularly given my grandmother’s dementia. 

Despite my mom and aunt’s best efforts, my grandfather passed away before they could help my grandparents make the transition to a facility. Like many women of her generation, my grandmother hadn’t handled the finances before. She’d always let my granddad oversee their pensions, investments and savings. He also kept up with their insurance, their taxes and their wills. Her focus had been on her job, the household and the family. At 86 years old, and on her own, she moved for the first time in more than 60 years into the long-term care facility that she and my grandad had been considering.

These stories aren’t unique to my family. The issues that the women in my life have faced, are examples that illustrate larger trends. Their patterns of being unexpectedly burdened with new responsibilities after years of being able to share responsibilities with others, demonstrates the necessity of women being involved in their family finances as soon as possible. Here are facts that highlight the reason for this necessary shift:

  • Women control 32% of the world’s wealth and that number is growing. For women in the United States, that number is even higher at 37%.
  • Women are already making lots of the family’s financial decisions. Women make 70% of the consumer buying decisions.
  • Having a clear understanding of your finances can give you more confidence to handle all of your other responsibilities. Women represent the majority of caregivers for both children, parents, and in-laws, but are typically much less involved in tax and investment discussions.
  • Statistics suggest that women may eventually be responsible for all of the family finances. Between ages 35 and 59, women are four times more likely to be a single parent than men. 
  • As women age, the likelihood of having to oversee family financial affairs increases. The divorce rate in the United States is growing fastest among couples from 55-65 years old. The average age of a widow in America is about 59. She will live, on average, 20 years longer than her husband and is less likely to remarry than a man would be.

In many areas of American life, women have always served as a firm foundation. I’ve often heard that women are the heart of a home. I think now is the time for women to be more active in the wallet of the home, as well. After watching the women I love get involved in their finances by necessity, I look forward to seeing the next generations of our family take a more proactive role in planning and manifesting their financial futures.

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