At most Mother's Day gatherings, money is rarely a convivial conversation starter.
Out in the financial community, however, moms and money are a big topic. There's been a lot of buzz and research into how women handle their personal finances.
According to several recent studies, women are very optimistic about the country's economic recovery but far less confident about their own abilities to manage money, pay for college their kids' or their own and retire comfortably.
And while often more willing than men to seek advice, many women don't trust financial advisers.
There are efforts to change that. From financial Twitter parties to better listening skills, financial advisers are getting the word: change. One of those leading the effort is Eleanor Blayney, co-founder of consulting company Directions for Women and consumer advocate for the national Certified Financial Planner Board in Washington, D.C. We spoke with her this week by phone and email. Here's an excerpt:
Why is there so much distrust of financial advisers among women?
It's a very hot topic in the financial advisory world right now. Every single major financial services provider has done their study documenting that many women don't trust advisers.
Financial planning is a very male-dominated profession. Many times a woman will come in with a partner or spouse and the financial adviser will not engage them. The adviser will speak to the male of the couple
But it's all sorts of other things, including cultural expectations. There's a perception that many women are number-phobic. It's a stereotype that can be self- reinforcing.
What's missing in how financial advisers approach their women clients?
I think we have underserved women. They're not a niche market; they're the majority of clients for financial advisers. If you think of the number of women in a client base, from couples to divorcees, widows and single professional women, it's significant.
Their biggest financial concerns are outliving their retirement income, becoming a burden to their children, affording long-term care.
Starting at age 65, the majority of women are single (due to divorce or widowhood). As advisers deal with women in those years, if they're only focused on how long money is going to last, they may well be missing the boat. You need a holistic approach. You may be dealing with a woman who's grieving, leaving the family home, facing longterm care. How are the financial decisions going to impact her life, emotionally, financially, physically?
You mentioned that financial advisers need to use "appreciative listening" with women clients. Can you describe what that means?
Appreciative listening can be exactly what it purports to be (i.e., full and careful attention to what the speaker is saying, their body language, etc.). Or it can refer to an organizational process where you solve problems not by focusing on what is wrong or broken, but on what is working.
In the context of personal finance advice, an adviser might listen to a woman and note areas where she is competent and capable in managing her money, her time and her resources, as opposed to focusing on her inability to stick to a budget or her failure to save. In other words, it is an empowering process, not a solve-it-and-move-on process.
You encourage social media as a way to engage women in financial conversations, such as last week's "Twitter party" for moms and daughters by GoGirlFinance.com. Why single out women for social media messages?
To say that women are more community-minded, enjoy socializing in groups and are more collaborative (than men) can certainly sound like stereotyping, but a lot of people say it anyway. But one thing does seem definite in terms of research: Women are the majority users of social media, and I believe social media usage is increasing the fastest for the 40-to-60 age group of women. But there is another aspect here, too. Women like getting information from websites, blogs and social media, particularly on difficult subjects like money management or investments, because it enables them to be relatively anonymous while they are learning and making up their minds.
What about younger women?
For a 30- or 40-year-old, her most important financial asset is her own human capital. We so often talk about financial capital, but there's also your human capital, the set of skills, experience, training and education that you bring to the workplace and get paid for.
There are so many ways advisers can help women with career management choices to increase their wealth. For example, a financial adviser can work with a woman to understand what she contributes in a company and to make a case for a raise. Women are far less likely to ask for raises, to negotiate aggressively. So if I have a young woman client, I can help her understand the industry she's in and prepare her to go in and get what she deserves.
For most women, money means nothing until it makes sense in the context of their life. When you hear "This investment will produce 1 percent a year" that doesn't speak to women as much as saying, "With this kind of return, it means a choice of where (your) kids can go to school, whether they can go to camp." It's a broader context. It's the quality of your life.
In parting, any Mother's Day financial advice to women?
My piece of advice to all women is the advice I would give my daughter: Know your worth. This means knowing your values (in terms of how you choose to spend time and money) but also your worth in the workplace. Don't be afraid to ask for what you are worth. If the answer is no, go to where the answer is yes.