Changes in relationships can impact the financial behaviors and mindsets of women, according to a study recently released by Equitable.
The study, “Women, Money and Relationships,” surveyed more than 1,200 U.S. women to better understand and measure their attitudes and behaviors when engaging with finances.
“As someone who has been married, widowed and now newly engaged, I understand firsthand how our relationship status can influence the way we think about finances,” said Connie Weaver, Equitable’s chief marketing officer.
“It’s important to understand how – and why – women’s attitudes and behaviors toward their finances change during all life stages,” she said, adding, “Life changes can be joyful and also challenging. It is critical that women have a plan, feel empowered and take control of their financial well-being.”
MDRT member Regina Bedoya, president of RB Financial Advisors, has also found that marital status often plays a part in how many of her female clients manage their finances. “Most women who are single or handle their finances by themselves tend to pay more attention to them,” she said. “They recognize that it is up to them to protect their financial well-being in the future.”
Key findings from the study include:
Different life events drive increased financial engagement. For single women, increases in their income are the number one life event that encourages them to become more involved in their finances. Married women cite becoming more involved gradually over time. Among divorced and widowed women, the end of their marriage and the death of their spouse, respectively, are the most common reasons they became more engaged with their finances. Further, more than half of divorced (52%) and widowed (56%) women surveyed express regret for not being more involved in financial decision making before their marital status changed.
Women overall wish they had paid more attention to their finances earlier. Regardless of relationship status, most women surveyed regret not paying more attention to financial matters earlier in their lives. This sentiment is the strongest among divorced (70%) and widowed (67%) women, compared to married (64%) and single (63%) women. Compounding this concern, many women also feel less confident about investing and retirement planning after a change in their relationship status. In particular, four in 10 widowed women say they feel less confident in handling investing (45%) and retirement-planning (43%) decisions following the death of their spouse. Also, three in 10 divorced women said that they are less confident about handling investing (32%) and retirement planning (31%) decisions after their marriage ended.
Women’s relationship status impacts their financial focus. While having enough money to cover unexpected expenses is a top financial goal across the board, single, divorced, and widowed women also list other short-term financial needs, such as being able to pay their monthly bills, among their top financial priorities. In comparison, married women surveyed are the most likely to report that their financial focus also includes longer-term priorities, such as being able to retire comfortably and having enough money to travel.
Changes in relationships impact financial confidence, but often lead to professional support. Married women (42%) are the most confident in their ability to reach their financial goals, compared to single (37%), divorced (35%) and widowed (29%) women. However, if a relationship ends, this feeling often changes. The study revealed that more than six in 10 widowed women (61%) feel further away from achieving their financial goals after the death of their spouse.
Importantly, a change in relationship status is often a catalyst for women to seek help from a financial professional, the survey said. One in four divorced women (26%) started working with a financial professional after their marriage ended. Further, 29% of widowed women started working with a financial professional after the loss of their spouse.
Advisor improves financial well-being
In addition to these findings, the study said that women who work with a financial professional, regardless of their relationship status, reported improvements in their financial well-being.
Nearly all women who work with a financial professional are saving for retirement (92%), and almost three in four (72%) have a written financial plan. In contrast, among women not working with a financial professional, only 64% are saving for retirement and a mere 16% have a written financial plan.
Additionally, women working with a financial professional are more than twice as likely to feel they are financially secure and saving enough than women who do not work with one.
But only a few use advisors
However, despite the benefits of working with a financial professional and regardless of their relationship status, only one in five women overall (20%) engages with a financial professional.
This provides an opportunity for more women to actively take charge of their financial future and develop a plan by working with a trusted financial professional who can help guide them through all stages of their life, the survey noted.
“Our financial wellness includes much more than our risk tolerance and what is in our savings accounts. It’s the total of all aspects of our lives, including our relationship status,” said Jody D’Agostini, a financial professional with Equitable Advisors. “This study underscores the importance of understanding and leaning into the differences in attitudes and behaviors across varying life events. We want women to feel confident about their financial futures, and that includes preparing for what sometimes might be the unexpected as they navigate their financial journey.”
Working with women
So, what are some of the steps advisors should take when working with their female clients, regardless of their marital status? The first step that Bedoya takes when working with her female clients is to ensure that the relationship is based on trust and shared intentions, namely their future financial security. “The strategies to achieve this will vary from client to client,” Bedoya said, “but the overall goal is to provide them with the income they need and a legacy plan that reflects their wishes. The ultimate goal in implementing these recommendations is to help them achieve financial peace of mind, something we all want.”
The study was commissioned by Equitable and conducted by Zeldis Research Associates from June 2023 – July 2023, among 1,702 respondents. The sample includes 1,202 women from the main sample, 200 from an oversample of divorced and widowed women, and 500 men.
Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at amseka@INNfeedback.com.
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