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In Financial Planning, Couples Should Work Together

Joanne Cleaver

Baby boomer women bring home the bacon, but they're still putting on aprons when it comes to equally participating in conversations with financial advisors, according to financial behavior psychologists and a study sponsored by Fidelity Investments.

"Overall, I am surprised at the degree to which women step back," says Karen Weisgerber, a partner with the North Bridge Advisory Group and a psychologist who specializes in the emotional implications of wealth. Women, she says, tend to be more vocal about the potential impact of money on family members' personal aspirations, while men usually want to manage money as a competitive exercise. And because most personal financial advisors are male, definitions and discussions of successful planning are dominated by men's money management mentality.

"Often, the financial advisors are male, and it's a male-to-male conversation. In broad strokes, if the man is the one who made the money or if it's in his name, she delegates that to him and she deals with the emotional and relational implications," Weisgerber says.

Yet women who relinquish understanding, along with control of the finances, also abandon the ability to manage their financial futures, advisors say. Small changes in how they assert themselves in conversations with spouses and financial advisors can yield big dividends in confidence and strategy, especially if a woman becomes a widow, which is a statistical likelihood.

[Read: Should Women Use Female Financial Advisors?]

Few women equally pilot their families' finances, although that number is gradually increasing. Fidelity Investments' "Couples Retirement Study," released in September 2013, found that 24 percent of women say they take responsibility for daily financial decisions, compared with 15 percent in 2011. The same study, which surveyed 808 couples over age 25, found that 19 percent of women were in charge of long-term investments, more than double the 2011 level.

This disparity says more about how women perceive their strengths than it does about their actual ability to manage money, says John Sweeney, executive vice president for retirement and investing strategies for Fidelity Investments. "It's not a lack of acumen. It's the division of labor. Women trust their spouses, and a third say that their spouses are better with numbers," he says.

Mary Gresham, a psychologist based in Atlanta, sees this all the time. Every couple has to decide who will handle what, and most intuitively align their responsibilities with their particular strengths, whether it's financial analysis or relational skills. "Your values are your point of view for all spending, from daily through estate planning," Gresham says.

[Read: Retirement Savings Tips for Couples.]

Couples reach agreement on financial priorities by focusing less on numbers and more on what is important to both of them, she adds. The financial resources you expect to have in retirement necessarily provide the context for where you will live, what you will spend and how. That's where financial projections - the quantitative - intersect with daily life expectations - the qualitative. "The job for every couple is to become a money team instead of designating one person as the money expert," Gresham says. "It's the division of roles that create conflict."

Advisors agree that women need to step up in financial planning conversations. One compelling rationale is to ensure they can smoothly take over if their spouses are incapacitated or dead. Mapping out that likely transition process and understanding how much money will be available, and from what sources, brings the point of planning into focus, Sweeney says. Planning it out will also help each person envision how the widowed spouse will navigate his or her new role. For men, this means assuming responsibility for the relationship implications of financial decisions. For women, it usually means managing today's money to ensure tomorrow's income, which equalizes the roles each partner typically assumes.

Think of being more assertive about financial planning as moving purposefully toward each other's future financial stability, Gresham advises. She suggests trading roles so that each spouse or partner gains competency, or at least a conversational familiarity with their significant other's expertise. "Explain to the other, 'Here's what's happening in my role," she says. "You both have to understand the whole picture. If you don't have time or interest to learn it now, do you really think you want to learn it in a crisis, when your partner is ill or dying?"

[See: 6 Ways Retiring Can Be More Affordable.]

Kathleen Gurney, principal of Sarasota, Fla.-based Financial Psychology Corporation, advises women to incorporate money management into their typical definitions of professional success. Integrating asset allocations and investment projections into discussions about personal and family hopes for retirement reframes the usual discussion about financial scorecards as the context for expected activities, lifestyle and family gifts, she adds.

"To take a stand and say, 'My opinion counts,' you have to look at your emotional balance sheet and see what matters to you and what doesn't," she says. "If you were to assert yourself with your advisor, what two things you would want that advisor to know?"

Finally, zeroing in on a couple of investment categories as categories of personal expertise is a good first step for women who have been hesitant to wade into spreadsheets, Gurney and other advisors say. "We feel confident only if we get involved, and only those who get involved with their money are confident," Gurney says.

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