With people living longer, the need to make as much as you can from your wealth-building years is more important than ever – no matter what your personal circumstances are.
This is as true for women as it is for men, especially given recent research findings that discovered a significant gap in investments between women and men.
“Women are typically carers, and tend to prioritise families and security over managing their personal financial matters,” Fiona Haughey, Financial Planning Manager, Davy, said.
“Women like to make really informed decisions and are generally more careful about making sure the decision is the right one for them – that’s not to say they won’t go into higher-risk investments, they just need to know that this is right for them,” Haughey added.
Time to take charge
Davy financial planners aim to help women take charge of their finances and explore every option open to them in order to make the most of their money both now and in the future.
This commitment stems from research commissioned by the company in 2021. The ‘Better Serving the Financial Planning and Investment Needs of Women in Ireland’ report, which revealed that although women lead on day-to-day banking and household saving and are as likely as men to have essential banking products and pension funds, women are 30 per cent less likely to have investment portfolios. In addition, men are 30 per cent more likely to be the household decision maker in relation to investments.
The research revealed that this financial disengagement stems from a number of factors, including social and cultural stereotyping, having lower confidence about finances, being 30 per cent more risk-adverse than men, deprioritising personal finances and not yet actioning financial goals.
With these insights firmly in mind, the Davy team is in a strong position to help female clients, as well as couples and partners, identify the best financial goals for them and their family, and devise a journey to help them get there.
Review your situation and make your goals
Your first step in taking control of your financial future is to take stock of what you have – your income, your expenses, what you own and what you owe.
Effectively, this could take place in your own home, with your family, partner or spouse. However, it is very beneficial to get the opinion of a financial planner – for both individuals and couples.
“As a financial planner, I try to get a holistic perspective of a client’s life, home, family, career, health concerns, financial protection and death – what happens if you pass away suddenly, or if you live a long and healthy life – how do you divide assets fairly?” Haughey explained.
The ‘what ifs?’ conversation can be uncomfortable but it’s hugely important. “People can have their blind spots, for instance, one partner might have a stable, well-paying job, while the other partner looks after the kids,” Haughey said.
“But if something happened to either parent, how would the household finances suffer? Who would manage your financial affairs? Who would look after the children? Is there adequate mortgage protection, income protection and life cover? Is critical illness cover something worth exploring?
“Engaging with a planner can help you understand the effect of these scenarios and the types of protection policies available to protect you and your family,” she added.
Knowing your personal situation can lead quickly into setting your financial goals, which in essence, maps out what you will realistically achieve.
Make a financial plan
The next step is to draft a financial plan. According to the Financial Planning Standards Board, individuals with a financial plan enjoy a higher quality of life, greater satisfaction with their financial situation and increased confidence.
“At Davy, we believe that a financial plan is the cornerstone for achieving your desired financial outcomes and overcoming potential challenges. This will help you clarify your goals, determine the best ways to achieve them and understand any necessary trade-offs.
“Getting a structured plan down on paper is hugely beneficial and gives a lot of peace of mind,” Haughey said, adding, “we also devise a detailed plan of action – what you need to save and invest per annum and how best to do this.
“We would recommend regular reviews of your financial plan, particularly if there has been significant changes in economic or personal circumstances. This ensures that the client stays on track with their goals. That’s part of our relationship management with our clients.”
Maximise your pension and savings
If you are in a top table job and able to build wealth, it’s time to make sure you’re making the most of saving and investment opportunities available for you, Haughey explained:
“Consult with a professional to make sure you are optimising your potential to build wealth. You could be accumulating a lot of cash. Pensions are the most efficient way of building savings in Ireland. Are you maximising your pension contributions? What opportunities are there for cash?
“Think about your goals and plans for your money. A professional can help you allocate your money to each of your goals.”
Talk about investment
Once you have reviewed your personal situation and set your goals, you can now work out your investment strategy. It’s important to first understand your risk tolerance – both what you are comfortable with, and how much risk you can afford to take.
Your planner can help you define this, Haughey explained: “There is an onus on us to explain, educate and inform clients on the level of risk they are prepared to take, the risk that they might need to take, and the risk that makes sense to take.”
A planner can give advice based on your goals, the actions required to achieve those goals, and the level of risk that is appropriate in investing to meet your goals.
Davy has a team of experts and a comprehensive array of platforms to help implement your financial plan, covering pensions, taxes, structuring, succession, philanthropy, protection and investments.
As Ireland’s leading provider of wealth management and investment banking services, Davy has been connecting capital with opportunity for almost 100 years.
Since its beginning in 1926, Davy has established itself as a leader in the financial advisory sector in Ireland, providing a broad range of services to private clients, small businesses, corporations and institutional investors.
It has offices in Dublin, Cork, Galway, Belfast and London, and employs over 900 people. Davy is a member of the Bank of Ireland Group.
Book a consultation with a Davy adviser today.
J & E Davy Unlimited Company, trading as Davy and Davy Private Clients, Davy Capital Markets, Davy Select, Davy Institutional Consulting, is regulated by the Central Bank of Ireland. Davy is a Davy Group company and also a member of the Bank of Ireland Group.