Trust, Husbands and Financial Advisors

A woman called into a talk show where the topic was marital fidelity.Saying she was done with men, the caller ended her commentary by asking "If you can't trust the person who takes a marriage vow with you, whom can you trust?"

I thought about her question as it applies to two professions dealing with money- financial advice and accounting. No financial advisor takes a vow before taking us on as a client. We can't check a track record because the names of clients are confidential. We have no way of knowing how well the advisor does in an economic downturn.

Bottom line, we're working on trust - giving our money to a firm or individual whose caveat is that past performance is no indication of future results and counsels us on the risks of investment. The certificates on the office wall testify to completion of a course of study, not a grade for performance.

The same holds true for the accounting profession. Most accountants are good at what they do. But they depend on accurate input from us to help us with our tax return. The accountant signs the return based on trust that we've provided all the information we're required to provide. If we're filing a joint tax return and most of the financial information is handled by our husband because we don't "do taxes", we have to trust he has provided accurate information.

Trust is involved in a transaction with someone when we do not have full knowledge about them, their intent, and the things they are offering us. However, when it comes to marriage, which requires no study, no training and nothing but a vow, trust is used interchangeably with love. Unfortunately, love is not a course of study and no one gets a diploma in the subject.

Bag Lady Fears: Rational and Persistent

Men, whether successful or not, don’t seem to worry about becoming destitute in their old age, invisible, unloved, roaming the streets, scrounging in garbage cans for food. But irrational as it may seem, successful women also suffer from bag lady fears.

Katie Couric, Gloria Steinem and Lily Tomlin admit to sharing this fear of becoming a bag lady. So did 48 percent of the 1,938 high earning women polled by Allianz Life Insurance in a 2006 poll. A stunning 90 percent of these high earners admitted to feeling financially insecure.

Many married women don’t have a history of understanding or managing money. They're not used to seeing the bigger picture. They think their husband is better at making the ‘really big’ money decisions. While they balance the household budget and decide what to buy, he handles the investments. If the marriage ends, they don't understand what he was doing financially. Often they find themselves responsible for financial decisions he made without their knowledge or participation.

The bottom line? Wives' financial decisions revolve around money spent and gone, not invested for growth.

Bag lady fears may be emotionally irrational for financially secure Katie, Gloria and Lily. Their fears relate to being out of control, of feeling weak and fearful that they can't make it on their own. For them, these are childhood tapes and no longer based on reality.

But for millions of women, divorce or widowhood is the wake-up call that they have to start thinking differently about money. Four in 10 marriages end before the 30th wedding anniversary. Only 16% of married women have a financial “Plan B” in case of divorce. The average age a woman is widowed is 56. Her average longevity is 84.

Every woman who isn't in charge of her financial life is at risk of being a bag lady if someone is planning her future. That makes the bag lady syndrome a rational fear which requires paying attention to now.

Trust, Husbands and Financial Advisors

A woman called into a talk show where the topic was marital fidelity.Saying she was done with men, the caller ended her commentary by asking "If you can't trust the person who takes a marriage vow with you, whom can you trust?"

I thought about her question as it applies to two professions dealing with money- financial advice and accounting.  No financial advisor takes a vow before taking us on as a client. We can't check a track record because the names of clients are confidential. We have no way of knowing how well the advisor does in an economic downturn.

Bottom line, we're working on trust - giving our money to a firm or individual whose caveat is that past performance is no indication of future results and counsels us on the risks of investment. The certificates on the office wall testify to completion of a course of study, not a grade for performance.

The same holds true for the accounting profession. Most accountants are good at what they do. But they depend on accurate input from us to help us with our tax return. The accountant signs the return based on trust that we've provided all the information we're required to provide. If we're filing a joint tax return and most of the financial information is handled by our husband because we don't "do taxes", we have to trust he has provided accurate information.

Trust is involved in a transaction with someone when we do not have full knowledge about them, their intent, and the things they are offering us.  However, when it comes to marriage, which requires no study, no training and nothing but a vow, trust is used interchangeably with love. Unfortunately, love is not a course of study and no one gets a diploma in the subject.