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By Ingrid Macintosh
• Jan. 25, 2021
Vice President
TD Bank Group

By Ingrid Macintosh
Vice President, TD Wealth and
Executive Sponsor, TD Women and Wealth

The financial industry in Canada is under-serving women.

Societal stereotypes, ingrained biases, and long-held assumptions about who should handle the money in Canadian households has helped prop up a system that disproportionately sidelines women.

Indeed, investment advisors approach men to offer financial guidance twice as often as they do women, which is likely one reason why nearly two thirds of women between the ages of 45 and 54 don't have a financial plan, and less than half of single women work with an advisor at all.

That needs to change. Studies have shown that 90% of Canadian women will be the sole financial decision makers in their household at some point in their lives, due to a number of factors such as divorce, personal preference, or the death of a spouse.

But there's another significant reason financial institutions need to overhaul a lot of their thinking and services – the scales of economic might are beginning to tip toward women.

In 2017, Canadian women controlled $1.3 trillion of personal wealth. And that number was projected to skyrocket to at least $3.3 trillion by 2026, according to a 2017 study by TD Wealth.

And yet at the same time that women are experiencing this increasing economic might, many women are also being disproportionately affected by the economic devastation of the COVID-19 pandemic.

This is partially because more women are employed in industries that have been most impacted by the pandemic, including the hospitality industry and non-profit sector; others are opting to stay home and care for children because of gender wage gap inequities, and childcare challenges which have historically placed a greater burden on women.

This disproportionate economic impact on women is so great that it's being dubbed by many policy researchers as the 'She-cession.'

Combined, this increasing economic might (due in part to inheritances by Baby Boomer spouses and parents) and the She-cession are creating what is shaping up to be one of the most pivotal economic moments in history for women.

And while this is unfolding, most financial institutions and economic policies haven't caught up to reflect this new reality. Women need the financial services industry now, more than ever, to offer better advice and services for them during this watershed moment.

Helping women build financial confidence and manage wealth

Financial service providers have an opportunity to better support women over the next few years as they bear the brunt of the She-cession, and as this massive transfer of wealth takes place. Support can come in many forms, including adjusting wealth planning strategies, and internal training policies and systems to be more inclusive of women's investment needs and their decision-making patterns, along with offering financial literacy programs.

One critical factor to bridge the gap between the growing economic might of women and the need to stop under-serving them is acknowledging that there is no one-size-fits-all approach that can be taken to address the diverse needs of all women. Some women may feel inclined to take more financial control of their lives, while some prefer to abdicate these financial responsibilities and planning to the partners in their orbit. Regardless of a woman's relationship status or the dynamics of her personal relationships, the industry needs to prioritize financial literacy programs to help bridge some of this gap so that any woman – or any person, for that matter – has the tools they need to make personal finance decisions with confidence.

TD Wealth is working to flip this script from the outside-in through a differentiated wealth planning strategy, focusing on both our people talent and our customers. We've updated our recruitment strategy to hire more women for senior investment advising roles, and have bolstered our advising approach to include behavioural finance research.

Behavioural finance is the study of how factors like age, gender, relationship status, and personality-driven traits affect how we invest. Are you an impulsive spender or more of an avid saver? Do you often trade stocks based on market conditions, or are you invested for a longer-term? Whether you know it or not, behind each financial decision we make are unconscious factors driving them.

Using behavioural finance, TD Wealth can work with clients to discover how their personality or demographic factors may impact the way they make financial decisions. This helps us better understand what motivates them, what influences their decisions, and helps identify financial blind spots that might interfere with their decision making. By better understanding clients' personalities and behaviours, advisors can have the right conversations at the right time and build a relationship that works. This newfound approach can better help women achieve their financial goals and shift their investment strategy when major life events take place.

Women and Wealth

In August, TD Wealth launched a Women and Wealth microsite to serve as a resource and content hub offering advice and financial information for women, regardless of background, economic status, or life stage.

Whether you're looking for advice on how to leave a solid financial legacy, need tips on protecting your assets in the event of a romantic split or divorce, are planning for retirement, or seeking career and entrepreneurship lessons from seasoned side hustlers, this site was designed to be a one-stop resource for women who are eager to meet their financial goals. You can also connect with a Wealth advisor directly from the site for more personalized, in-depth advice.

Change starts within

I'm really proud of the work my colleagues have put into creating the site in recognition of the need for us to collectively step up for women. But it's the work we have done as an organization to self-reflect and look at ourselves honestly and critically to find new solutions for this challenge that I am most proud. The industry needs a refresh, but it gives me hope to see the progress that TD has made as an institution. This progress comes in many forms, like our commitment to increasing the number of female advisors.

As a financial institution that is aiming to help all clients develop greater financial confidence, our efforts to help increase financial confidence for women with different socio-economic backgrounds (and who have different needs), especially, must take on many forms.

From educating TD advisors on understanding the criticality of this economic shift, to sharing insights into the values, challenges, and women's financial needs through our Women and Wealth training workshops, we have made strides. But the work is not over.

While unprecedented financial strain continues to be a challenge for many women as a result of the pandemic, research (including this study from 2017) shows that 87% of women struggle to find an advisor with whom they can connect. This tells me that there has been much more opportunity for financial institutions everywhere to better serve women in this area and that opportunity will only increase. It will be interesting to witness how we as an industry prepare for this next chapter of economic transformation.

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