Some women are paralyzed when it comes to dealing with their money, according to Molly Ward, a financial advisor who serves on the Elite Producer Group board at AXA Advisors.
The fear of dealing with their finances can make women, and even some men, make fatal financial mistakes, said Ward, who has built her Houston-based practice around helping high-net-worth women fulfill their financial potential.
“I see fatal mistakes that incredibly bright, hard-working and good-hearted women make with their finances. This is often especially true of single women, whether they are divorced, widowed or never married,” she told Financial Advisor magazine. “The biggest, most common pitfall is simply not dealing with their money at all. The fear and anxiety surrounding money for so many women can be paralyzing.”
Ward said she helps women develop a good relationship with their money.
“Whether they have a health crisis, a death or a divorce, women, and some men, can go through unnecessary suffering” trying to deal with their finances, she said. “The financial industry could do a better job of creating more friendly messaging” to relate to women.
Money and life are intertwined for everyone, she added.
“I have had clients come to me and ask if they are spending the right amount of money. One woman wanted to know if she should be an Old Navy shopper, a Nordstrom shopper or a Pink Elephant [a Houston boutique] shopper.”
Ward said guidance can help women develop a healthy relationship with their money to know how much they can and should spend and that topic opens up a conversation about all aspects of money.
“I have women clients who are concerned about a potential recession. They fear they can more easily lose their jobs during a recession or they may be afraid of investing,”
One of the mistakes women make is keeping too much money in cash or having too much tied up in a successful business. They also fail to look at other financial aspects of their lives outside of the investment portfolio.
If a client has too much money in cash, Ward said that she might advise her to do dollar-cost averaging so she is not investing everything at once.