Getting money from a transition, whether in good or bad circumstances, can be traumatic for a woman and mean extra work for her financial adviser — financially and personally.
In the “Women & Investing” webcast Tuesday, moderated by InvestmentNews contributing editor Mary Beth Franklin, wealth management experts discussed the two sides of a woman gaining money from a sudden change, such as divorce or becoming a widow: the technical side of it, which involves how the money is managed with a planner and lawyer, and the personal side, where the decisions are made based on relationships, fears and expectations.
“Our belief is that these two sides are equally important,” said Susan Bradley, founder of Sudden Money Institute.
For Kathleen Rehl, founder of Rehl Wealth Collaborations and author of “Moving Forward on Your Own: A Financial Guidebook for Widows,” the need for financial advisers to learn a new perspective on handling transitions was inherently clear when she became a widow in 2007.
“I really, really got it when I walked the walk about how impactful this overwhelming grief is,” Ms. Rehl said. “What I'm doing now is spending a lot more time speaking, teaching, writing.”
Ms. Rehl said when a woman's husband dies, her financial adviser should put aside the work and tend to her personal feelings, asking open-ended questions, avoiding clichés and referring to the husband's name so she knows he won't be forgotten.
There are three stages of a transition from being a widow to being financially independent — grief, growth and grace.
“They'll want to talk about what's going on in her life rather than just jumping into what the quarterly reports look like,” Ms. Rehl said. “She will always have a relationship with her husband, she's never going to get over the death of her husband, but there will be new life and an exciting time.”
Sometimes, women are finding new life after a divorce. Justin Reckers, director of financial planning of Pacific Wealth Management, said he always addresses a woman's feelings about her ex-husband by calling him a was-band, a fun and light way to make her laugh during a stressful time and avoid any concerns by his client that he may not be on her side.
“They go through similar stages,” Mr. Recker said. “They know I'm their advocate, aligned with them, and I have their best interests in mind.”
Ms. Bradley said a woman facing a transition needs help communicating, developing confidence and seeking advice.
“Women are looking for real connections through communication, they're looking to feel confident about what the adviser is explaining and the consequences,” Ms. Bradley said. “We have to develop tools for that.”