Meghan Hicks, a Lawyers Financial Advisor in Kelowna, British Columbia, helps many female lawyers manage their finances and plan for the future. After more than a decade working with a wide variety of clients, she has some valuable advice to share.
According to Ms. Hicks, it’s important to look at the world with an objective lens and see that financial plans for women, particularly lawyers, need to account for three things: (1) due to career interruptions and continued issues around pay equity, women often make less money throughout their career; (2) they are likely to shoulder the responsibility of caregiving for others at every life stage; and (3) they live longer.
These realities, coupled with the fact that female investors are often less comfortable with financial risk, mean it’s critical that women have a comprehensive plan in place now and for their future.
For many female lawyers, the desire to start a family coincides with the time when their career is getting traction. The decision to focus on family can slow their career momentum and lead to a reduction in income for a period of time. Financial planners can help their clients plan for these events so the financial impact is minimized. As Ms. Hicks puts it, “knowing you have a plan and are on track financially allows you the confidence to focus your attention on family, a successful practice and securing your future.”
Caregiver for life
Women have typically assumed a larger share of caregiving responsibilities. Early in their careers, they care for children. Later, they care for aging parents. “The sandwich generation knows all about the one-two punch of time and financial pressure when you’re caring for a generation above and below,” says Ms. Hicks. “We can’t alter that reality but we can plan for it. And that makes all the difference,” she adds. “A good plan changes and adapts as your life does with a clear direction on where you are and what you want for your future.
According to Statistics Canada, women typically outlive men by about four years. “Women should expect to outlive their male counterparts and that’s why it’s important they play an equal role in the creation of a family financial plan and establish a good working relationship with their advisors. That way, there are no surprises or questions about what to do next,” says Ms. Hicks. It's also a good idea, she says, that the plan be prepared with the help of someone who understands the unique circumstances of the legal profession.
A case in point
Ms. Hicks and her team were approached by a senior lawyer who assumed that her group health insurance coverage, offered by her firm, would be sufficient to cover extraordinary medical costs but it wasn’t. The team reviewed the situation and showed her how to purchase complementary coverage that would fill in the gaps. Purchasing additional coverage turned out to be far more cost-effective than liquidating assets with long-term growth potential. “A lot of people don’t realize that you can purchase and combine any number of policies to create a more robust insurance plan. It’s our job to assess the situation and personalize solutions,” says Ms. Hicks.
Where to begin
It’s never too early to start planning. “The seeds of success can be planted when you are fresh out of school and laying the foundation for your career,” says Ms. Hicks. Her suggestion is to get advice from someone who understands your needs as a member of the legal community. “Every financial decision has consequences that compound over time. Starting early, when you’re young and healthy, results in a plan that grows with you and your career. It’s all about creating positive habits – start early, get into a rhythm of saving and investing, and seek out guidance and support along the way.”