In a post-covid world, can financial advice be a force for good in promoting improved economic outcomes for women?
With International Women’s Day on 8 March and the return to school for millions of children across the country, this week was a big one for many UK women.
But don’t sound the celebratory trumpet just yet. Because while there is light at the end of a seemingly interminable tunnel, after a year of combining home school, home working and everything in between, many women worldwide are simply exhausted, with dwindling finances to boot.
And while women don’t own the monopoly on pandemic-induced fatigue, when you look at the facts, it’s clear that we have a hefty amount of skin in the game.
Research from UN Women revealed that 25 years of progress towards gender equality could be completely wiped out in a year, as women absorb the lion’s share of domestic chores and family care on top of paid employment responsibilities.
Even before the pandemic, it was estimated women were doing about three quarters of the 16 billion hours of unpaid work that are done each day around the world.
On childcare, the UK boasts the undesirable title of having the most expensive system in the world, making it financially unviable for many mothers to return to the workplace. For contrast see Sweden where childcare is heavily state subsidised and costs parents on average up to 3 per cent of household income instead of the UK’s average of a whopping 35%.
Despite this, provision for more accessible childcare was excluded from the Spring budget announcement on 3 March, a decision that could cost some women dear: according to research by Pregnant Then Screwed, 46 per cent of mothers being made redundant said that lack of childcare was a factor in their selection for redundancy while 72 per cent said they worked fewer hours and cut their earnings due to lack of childcare.
The devastating consequences of this for women’s overall economic progress and independence are undeniable.
Well we’ve already seen what happens when women’s finances are made a secondary consideration at a governmental level at least, with the recent discovery of the millions of women whose state pension entitlement had been reduced in error, to the tune of more than £3bn.
So how can financial advice help?
Later life planning
But there is reason to be hopeful: with later life planning, one of the number one areas many advisers provide vital support for their clients, and against the backdrop of a complex state pension system coupled with huge uncertainty around whether private pension contributions are sufficient, this is an obvious area of real value.
A lifestyle based approach
With growing interest in holistic financial planning for clients, the combination of a lifestyle based approach towards achieving broader vision-based client objectives plus a practical focus on establishing a solid financial roadmap to deliver results could be a game changer.
This is a huge opportunity for the industry as advisers, many of whom already double as financial therapists for their clients, seize opportunities to deepen relationships, enhancing customer lifetime value and client satisfaction simultaneously.
Increased pipeline of female financial advisers
For an industry based on relationships, rapport truly counts. For the millions of women who would benefit from receiving professional guidance, many of whom would prefer to do so from another woman, data shows that just 17 per cent of FCA approved individuals are female, a figure that has barely changed since 2005, is discouraging.
Continued efforts made collectively by the industry to attract new graduates entering the workforce as well as women changing careers could go a long way to improving this figure.
Fee reform as a conduit to greater access and inclusion
This is not a call for discount pricing when it comes to financial advice, after all, value for money means different things to different people.
But a recognition of the barriers put in place for clients in gaining access to the industry’s valuable professional guidance and expertise is essential in driving greater inclusion for marginalised groups, women included, and ultimately helping to level the financial playing field.
In the midst of widespread financial uncertainty, one thing is clear: the role of advisers in helping their female clients improve their economic outcomes and overall quality of life is invaluable. The industry is more than capable of rising to the challenge. The real question is, will it?
Davinia Tomlinson is the founder of rainchq
