You can't be afraid of money

LYNNE RAE ZLOTNIK

Since the early 1960s, women have made excellent progress in many areas, but not in financial literacy. The topic of money for most women is mystifying and frightening – but this can change.

The prospect of marketing to women is a complex, but interesting, one. Women buy or influence the purchase of 85 per cent or more of what is sold. Baby Boomer women are an emerging powerhouse and they are the healthiest, wealthiest, most secure and empowered generation that we have seen. Yet, a Canadian survey by Thomas Yaccato Group revealed that women's satisfaction level with many industries was well below 50 per cent. This is unacceptable in many sectors and, therefore, much is changing in terms of marketing to women.

For more than 20 years, I have been developing a financial education program specifically for women, so that they can empower themselves around money. Women integrate information and experiences from many sources to make informed decisions. They tend to approach things with a critical eye and they "talk," so you want them to talk about you in a positive light. But women often have a rather complicated and dysfunctional relationship with personal finances, even though they may be top notch in running their homes and careers.

Women need to educate themselves on the mechanics of personal finances so that if there is a divorce or if their husband passes away, they will be able to take control of their family financial situation immediately. Women also need to take a more active role in their family's personal finances, simply because having two brains instead of one always works better. Women are just as capable as men when it comes to personal finances and financial planning, but they often choose not to be involved in it, even though most men would welcome their partner to take a more active involvement in their finances.

Women tend to like to learn in groups and through reading, and there has been more emphasis given in the literary world to financial books geared to women. The following recipe for success is based on financial literacy:

Take Control. Women have been typically afraid to take charge of their finances. However, they must overcome this fear and take steps to self-empowerment. It is critical that a woman who ages does not feel totally dependent on someone else for her financial power.

Learn everything you can about financial topics. If women are afraid of the process, read a great little book called Prince Charming Isn't Coming: How Women Get Smart About Money. This beautifully written publication is easy reading based on a true story, which outlines the difficulties Barbara Stanney encountered when she left all financial decisions to her husband. Stanney had no idea that her husband was a gambler and a wild investor, eventually leaving her penniless and with a tax debt of $500,000. Stanney discusses the process to learning about money and the book is a primer for women of the steps required to empower themselves.

Be conscious of your spending habits. Shopping can become an entertainment that is costly and prevents you from having the financial security you need. A great book to read on this subject is Ms. Spent Money Guide: Get More of What You Want with What You Earn by Deborah Knuckey.

Save regularly, by taking at least 10 per cent out of every pay cheque. This can make you a millionaire. Read David Bach's Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich for the details on this one. He proved that by cutting back on everyday thoughtless purchases (the "latte factor"), one can save 10 per cent or more and turn it into a healthy retirement savings.

Start soon. If you are 45 years or older and have not started saving – it's not too late! Read Start Late, Finish Rich: A No-fail Plan For Achieving Financial Freedom At Any Age by Bach for the answers to a late-savings program.

Final Preparations. You need an estate plan and should consult with an estate and wills lawyer, depending upon the complexity of your estate. For reference here, look at the book by Sandra Foster You Can't Take It With You: Common-Sense Estate Planning for Canadians. It is a well-organized list of steps you must take to prepare for proper estate planning.

There is a lot of information out there that will give you a good start. For basic financial literacy, read Learn to Earn: A Beginner's Guide to the Basics of Investing and Business by Peter Lynch, Rich Dad Poor Dad: What the Rich Teach Their Kids about Money by Robert Kiyosaki (a must read for your children as well) and The Millionaire Next Door: The Surprising Secrets of America's Wealthy by Thomas Stanley. If you follow this financial literacy recipe, you will be well on the way to a better financial future.

Lynne Rae Zlotnik, president of LZ Wealth Management, has more than 20 years experience as a financial services specialist. She provides Investing for Women and Taking Control: Financial Management seminars for women, Long-Term-Care Insurance seminars, Retirement seminars and Financial Clutter Busting workshops. Her website is www.lzwealthmanagement.com. You can reach her at [email protected] or 604-630-1879.

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