Let’s talk about… money!

Let’s talk about… the M word (money)

Part of the reason we set up Addidi as a financial planners specialising in women is that we recognised that women were largely ignored by the financial services industry. When it comes to financial products, women often tell us they feel overlooked and ignored.

Over time, many women have (understandably) become disenfranchised with the industry as a whole. Unfortunately, this often has further knock-on effects – leading to women failing to engage with their financial futures and not wanting or willing to investigate the options available to them.

So we’re going to be putting together a series of articles to look in further detail at several different topics relating to financial planning – dispelling the myths and giving you the lowdown on the things that matter.

The first in the series is all about that dirty M word…Money!

We need it to buy things. We need it to do things. We need it to live. But we hate talking about it.

It’s money.

The reasons why we hate talking about money aren’t clear cut. Maybe one of the reasons is that in relative terms, women’s rights in relation to money have only evolved fairly recently in history. As an example, women in the UK have only able to apply for loans and credit cards in their own name since 1980! With money and finances being traditionally viewed as the domain of ‘men’, there may be a bit of a ‘hangover’ from this.

Perhaps it comes down to a lack of knowledge, confidence or experience? Maybe, as outlined above, women feel excluded from the financial world and therefore feel they somehow lack the know-how to talk about it?

Whether you like it or not, the fact is: money matters.

Money allows us to do the things we want to in life rather than being forced down a path because we have no choice. Money puts us in a stronger position when life deals an unexpected turn – giving us more options and greater stability. Also, with both women and men living longer than ever before, it’s worth remembering that money has to deliver for longer than it ever has before. Even if you work into your 60’s, a pension or other ‘retirement pot’ might feasibly have to last another 30 or so years.

One of the things that sets Addidi apart from other financial planners and wealth managers is that we recognise that money means different things to different people.  For women in particular, money is often viewed as a means of security.

Unfortunately, women’s propensity to avoid talking about money doesn’t do many favours. The more you shy away from money and the things you can do to make more of it, the less likely you’ll be able to make the most of what you have. The less willing you are to get a grasp of your financial circumstances and put the time and effort info financial planning, the less you will have in the long term.

Without fully embracing your finances, by the time you reach retirement, the likelihood of you having a decent retirement fund to fall back on is low. In fact statistically, women have significantly lower pension pots than men, with the average pension pot of a woman at 65 being £35,800 – a fifth of a man’s at the same age. So what can be done?

Don’t shy away from the facts

Human nature may lead us to not want to talk about money. But that doesn’t mean you shouldn’t have knowledge about your financial position. Being aware of how much money you have, where it is and whether or not you are able to instantly access it is the first step to being able to control your financial destiny. This includes money in pension pots and property – which are generally considered to be illiquid funds (ie. not accessible instantly). From here, you can determine what you need to do to attain the goals you may have – for example, retiring at 65. Many people – women and men included – are blissfully unaware of how much money they will need for their retirement, meaning that several will fall short. There are several calculator tools available online to determine how much you need to save for retirement. If you are nearing retirement age, you should also check the government’s pension tool to find out how much you will be entitled to and from when.

Do your own research

Although many women feel they aren’t catered for by the financial services industry, this doesn’t stop you taking matters into your own hands. There is a wealth of information out there that you can use to educate yourself; arming you with the knowledge you need and giving you greater confidence. Check out The Money Advice Service and Boring Money for lots of tips and advice articles.

Find the right adviser for you

If you go down the route of professional financial planning, make sure you find an adviser you’re happy with. Clients often come to us having had bad experiences with other advisers – saying they didn’t feel their needs were catered for or understood. A financial plan should be pieced together to achieve your own personal objectives, so it’s key to find someone who is able to work with you and vice versa.

Money needn’t be a dirty word. As women, we need to embrace money as an important factor in our lives. It can’t and will never be able to buy happiness. But the more of it you have, the more choices you are afforded.