Know your worth, know your wealth

Over the past few decades, women have established themselves as business owners, heads of major corporations, and economic leaders. They currently control more than half of the personal wealth in the United States, and by 2028, women will control 75 per cent of discretionary spending around the world. They’re also staying single longer, whether that be by choice, or circumstance. What’s most interesting though, is how despite these advancements, many women are still deferring important financial decisions to men.

Understand the Wealth Planning Process

Up to two-thirds of women over 75 have outlived their spouses and those who have not created the wealth in their families often have not been involved in financial decisions up until this point. In fact, many women in this position tell us they feel unprepared when faced with having to take a primary role in their finances.

“It’s not uncommon that we’re approached by widowed women who need help understanding or re-evaluating their estate plan following the death of their husband. Many of these men were very successful during their lifetimes and took full responsibility for the family’s wealth plan,” said Linda Elfenbein, Head of Fiduciary Services at HSBC Private Banking.

“When our clients find themselves in these situations— where they haven’t been as intimately involved in the wealth planning process and their current estate plans don’t provide for the remaining family members the way they want to— we have an issue. In one instance, a client’s family circumstances had changed since her husband’s death and the client wanted to provide differently for one son. We were able to work with her to update the financial picture and restructure the passing of her assets to reflect new preferences.”

It’s more important now than ever to engage and educate both spouses as early as possible to discuss their income flow, how they can meet their needs while maintaining their current lifestyle, and if necessary, make appropriate changes to distribute wealth among family members. By enabling female clients to be a part of the wealth planning process from the get-go we can ensure their comfortability down the road.

The Importance of Goals Based Planning

As wealth increases, often so does the complexity of planning for that wealth. We enjoy getting to know our clients and align their concerns and goals with tailored solutions while making sure each member of the family can understand the plan and the outcome. This approach puts the client in the driver’s seat instead of leaving them vulnerable to a reactive situation by only addressing these complicated issues upon a triggering event like a death or divorce.

Having a collaborative approach to financial and estate planning also allows us to have more meaningful relationships with our clients that enable them to be financially independent, should they find themselves in a position where they want a divorce.

“Going through a divorce can be incredibly challenging, and for some of our female clients who might not have been involved in the wealth planning process before, it’s important that they feel they’re working with a team who understands them and what they’re going through— financially and emotionally,” said Carly Doshi, Head of Philanthropy and Family Governance. “It’s our responsibility to advise them on managing significant amounts of liquidity while developing best practices for protecting their wealth in the future.”