At a time when gender parity and glass ceilings at the workplace remain hot topics, Professor Claudia Goldin, winner of the of 2023 Nobel Prize in Economics, makes an important observation that “differences in pay and labor force participation are due not to biological differences but to differences in the division of unpaid caregiving responsibilities between heterosexual couples.”

A recent newspaper report presented facts and figures to state that post-pandemic job recovery has been elusive for women. Though women have a greater participation in the labour force and their unemployment rate has gone down, the dip in unemployment and the wage differential continue to be skewed in favour of men.

Yes, there arepersistent differences in employment and earning opportunities. Does that mean“she” handles her financial planning differently, too?

The differences underline the need

It is common knowledge that as the predominant caregivers in the family, women are more likely to take breaks from their careers than men. This could be necessitated by the need to relocate with the spouse, birth of a child or having to takecare of the ailing elderly at home. It is not unusual for women to opt for a lower-paying job if it means she gets more time to take care of the family, of enjoying a better work-life balance. Whatever the reason, the break or dip in earning hampers her capacity to save and invest.

Doesn’t this suggest a crying need for her to seek expert help in financial planning early in life so that she is both well informed and knowledgeable to stand on her own when the time comes?

Closing gap?

Research based on the 2018 National Financial Capability Study conducted in the US surveyed the financial behaviour, knowledge, and attitudes of adults. The assessed behaviours included fully paying the credit card bill every month, maintaining a three-month emergency fund, having non-retirement investments, and keeping a robust retirement account (not related to the employer).

The study concluded that “females may not be well-prepared for financial decision-making in single or joint households, which can have adverse consequences for managing current personal finances and building wealth for the future.”

Citing the US situation, the CFA report is confident that by 2025, “there will be no meaningful gender gap in stock market participation”.This is based on three factors: “the financial industry is shifting to products that women are more interested in; new technology is making it easier for women to invest; and the institutional investing gap [has begun to] to close.”

We too believe that the gap is beginning to close, even if it takes a little longer than a couple of years.

Our approach

Some of us were a little apprehensive about starting a gender war of sorts but we decided to put the question to our team members primarily involved in creating and maintaining the financial plans of clients across the globe: What would you do differently if your client was a woman?

To begin with as a Financial Advisor must spend enough time to understand the client, assess the risk appetite, draw up a plan, discuss and finalize the plan, review regularly and keep it going. If she prefers to deal with someone of the same gender, we can easily make it possible, with specialists pitching infor expert advicein the background if and when required.

The investment strategy will vary from individual to individual however the financial planningpath would be largely the same for anyone, regardless of gender.

So, we work on the plan that works best for you, while we remain mindful of the realities that you have to cope with, the dreams you would like to accomplish and the pressing problem you need to resolve. (See:How we have helped her.) So, If tomorrow, we were to have the privilege of sitting with Prof Goldin to chalk up her financial plan, we would work on similar lines regardless of gender.

Of course, if she permits, we will not miss the selfie after the conversation, as a trophy that would inspire the whole team (men and women included).

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