Suddenly Single - Advice for when life throws a curveball - Part 1
Published: 24/03/2022
Wealth for Women +
20 Minutes =
Confident Investing
Two of the most difficult transitions that a woman may face are widowhood and divorce. As life events will have a profound effect on a woman's financial circumstances, women will likely be the sole decision makers in their life at some point.
Listen to part one of this special two-part Wealth for Women speakers series hosted by Ingrid Macintosh and featuring Laura Barclay, Senior Portfolio Manager, TD Wealth Private Investment Counsel, and Kathryn Delgreco, Senior Investment Advisor, TD Wealth Private Investment Advice. Together they will discuss the challenges women face when a life requires them to assume responsibility of their finances and the key role a wealth advisor plays in this transition.
Discussion points include:
- How advisors help prepare and navigate through widowhood? (5:00)
- Women will typically abdicate financial decisions to their partners, what happens when they are caught off guard? (9:00)
- Divorce can be blindsiding and financially devastating – how can we navigate through this? (12:00)
To learn more about how TD is supporting women throughout Canada, please visit the TD Wealth for Women page and for more TD Wealth for Women and TDAM Talks Podcasts, visit the TDAM Talks page and send us an email at td.tdamtalks@td.com to provide feedback or recommend future topics.
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NARRATOR: TD Asset Management welcomes you to this week's podcast. As a reminder, this podcast cannot be distributed without the prior written consent of TD Asset Management.
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INGRID MACINTOSH: Hello, loyal TDAM Talks listeners. This episode part of the wealth for women speaker series featuring senior portfolio manager Laura Barclay and senior investment advisor Kathryn Del Greco was so insightful that we split it up into two sessions. Here is part one of "Suddenly Single-- Advice for When Life Throws a Curveball."
Hello and welcome to our 7th edition of the TD Wealth for Women Podcast series. This is a special quarterly series of TDAM Talks, and my name is Ingrid Macintosh. I have the privilege of being the executive sponsor of the TD Wealth for women program. Today, we're going to talk about two of the most difficult life transitions that women may face, widowhood and divorce.
Over 40% of marriages will end in divorce. And it might be surprising to know that the average age of widowhood in Canada is just 56. The upshot of this means that even if women in partnered relationships are not today taking a leading role in financial conversations, they will likely be the financial sole decision maker in their life at some point.
More specifically, these life events have a profound impact on a woman's financial circumstance. And how we help women both prepare for and navigate these transitions is critical to their future well-being.
So to bring this dialogue into focus I have the privilege of being joined today by Laura Barclay, senior portfolio manager, TD Private Investment Council and Kathryn Del Greco, senior investment advisor, TD Private Investment Advice. Collectively, Laura and Kathryn bring over 50 years of experience and are trusted with over $2 billion in client assets. Notably, Kathryn and Laura were both named recently as two of Canada's top wealth advisors in 2021.
On that note, Laura and Kathryn welcome to our podcast series.
KATHRYN DEL GRECO: Thank you. I'm happy to be here.
LAURA BARCLAY: Thank you very much what a privilege.
INGRID MACINTOSH: It's going to be a great conversation. And I want us to get as intimate and direct as we can about these transitions, because this is so much more than a conversation about managing money or managing funds. This is actually helping women through financial advice navigate a really difficult transition.
Laura I'm going to start with you. Can you just give me a little bit of a background, in terms of your history, your practice?
LAURA BARCLAY: Sure, so a little bit about me. My background, I'm a chartered accountant and a chartered financial analyst. I joined the TD Private Investment Council business about 14 years ago. Given that we're collectively 50 years, there's a good chunk of time before that I joined the business, where I had some experience on the accounting and tax and risk credit side of the world.
So that's a little bit about me. I do manage a fairly large book of business that is focused on women investors and empowering women, building knowledge, and just helping them shape their futures and their choices.
INGRID MACINTOSH: Really helpful. And when you lay out your credentials, very much they are in the financial sphere. But I think as our listeners will hear today, so much of the role that you play goes beyond the technical capability but really the things that women need to be thinking about and the journey that they're on.
Kathryn, similarly, can you share your background and a little bit about how you build your practice?
KATHRYN DEL GRECO: Yes, absolutely. I have been in the investment management business for 40 years. I'm a certified international wealth manager, a Canadian investment manager, and a fellow of the Canadian Securities Institute. I have a natural passion to want to support and educate and empower women in their investment life and give them the resources that they need to feel stable and feel in control of their own financial destiny.
To me, money is more than just a number. It's what the money can do for a person that really connects them to their investment strategy. And it really is a very key difference in how I connect to my clients and how I communicate how we should approach what we are doing for them.
INGRID MACINTOSH: I think that really sums so well what we are focused with the TD Wealth for women program, is helping both our clients understand, as well as our own advisors in our business. So, the conversation with women around money and around their finances is more than numbers. It is really about how we are helping them reach their goals.
So, let's take into the conversation for today. Because I shared some stats right at the outset around widowhood and divorce. And these are two key life transitions where the partnership with an investment advisor really is so critical to coming out the other side appropriately. When we think about widowhood, I'm going to start with you, Laura. Can you talk a little bit about how you in your practice both help in some cases prepare for widowhood, if it's a known event, or how you help somebody migrate through if it is a surprise event as well?
Both are-- it can be one of both ways. But I think the importance of advice is critical. Maybe you could take us through how you think about that.
LAURA BARCLAY: So, I think my number one starting spot is really to think about the relationship that we have with the couple when both are alive, and to make sure that the wife or the spouse is at the table, in order to have the conversations and build the trusted relationships. Because, I think, when I look at my clients who've gone through this, there is so much pain at the time of the event and so much grief, and so much fog and exhaustion. That it's one more layer If you don't have a trusted relationship on the banking money side.
And to have us be in a position to help quarterback the client navigating, locating the money, figuring out how to get access to get bills paid, are accounts in joint name, is their easy access with right of survivorship, that sort of thing. So, when speaking, I picked up the phone this morning and called one of my ladies who was a widow just over a year ago. And I asked her what were some of the things that meant the most to her today looking back on that time.
And she talked a lot about the support of friends and family. And I think if you can build a support system, we know that death and taxes are the two things that we have guaranteed in life. So, whether you're the person who dies and has an estate plan that needs to be executed or you're the person left to deal with an estate plan, I think having a roadmap in place to understand what to expect and what happens.
I mean, there's a number of things that really surprised me just working with clients. If you have a joint debt, for example, typically that joint debt will get frozen. Maybe there'll be a little buffer. Maybe there won't be a buffer. But it's a joint debt. So, one of the parties passes away, and you think you're going to be able to tap your line of credit on your house, you may not be able to. Because the banks may require a qualification under your earning potential. So that can come as quite a surprise.
And so little things like that, whether credit cards get canceled. If they're in someone's sole name alone, and you let your bank know that the person has passed away, the credit cards will be blocked. You know, we get all kinds of things. The utility bills, they're just logistical things that require time and effort. But when you're in the middle of grief, it's almost overwhelming to have to navigate all this.
So, I did ask my client this morning. You know, what did she do to handle sort of that. She said, she had a list on her counter. She had multiple lists, lists for the house, lists for the business, lists for the assets that needed to be sold. And it was a daily list. So, she only tried to take one day at a time. And I would say that was the way she focused on getting through this and surviving it.
INGRID MACINTOSH: And when your clients have the benefit of being in a trusted relationship, and clearly by the way that you have framed the tone of your specific practices, more than most advise your relationships, it feels like the woman is very much at the table and part of the partnership. Have you experienced with women where they have been more outside of that relationship?
Because we know that so many women do defer the financial decision making, not the day-to-day bills, but the long-term investment planning-- they often abdicate that accountability to their partners. So, have you seen situations where women were really caught quite off guard or had no idea how to-- where their family stood.
LAURA BARCLAY: Yes. So, I have another client who was widowed. Her husband was the ultimate gentleman. He recognized that she would not be in a position to manage the money the way he managed the money. And so back in about 2015, he came on board to my practice. He was a very astute investor on his own. And he brought in the relationship, so that I would be in a position to support his wife if something happened to him.
Unfortunately, he had a massive heart attack and shockingly died. She was very much caught off guard. And she had a very light relationship with us. I'd met her at the door of the house. She'd sign some paperwork for some joint accounts. And that was the extent of our relationship.
And today she's now a client. A lot of the assets in that situation, I think, very surprisingly, he had tried to protect her. She was his second wife. There were children that were adults from the first marriage. One of the things we also learned is that he had the homes in joint name. He had named beneficiaries, that she was the beneficiary of the registered accounts. But the kids were going to inherit the non-registered accounts.
And mathematically, that makes sense. But as a result, the kids were named as executors of the will. Well, whoever the executor of the will is typically has control of the body. And that may not necessarily be comfortable, if you don't have a really warm relationship, in this case with your stepchildren. And it was very awkward.
And the stepchildren cut off the Roger's account, because it was automatically going to dad's credit card. They cut off a bunch of things. They forwarded the mail, because under-- as the role of the executor, they were entitled to forward dad's mail. It was so upsetting. So, in the midst of the tragedy, in the midst of all of that, there was a bit of a gap in some planning. Because I know that that is not what he would have wanted.
His intention was to make life easy for the children after he was gone and his spouse, who he dearly loved. But that's not exactly what happened.
INGRID MACINTOSH: Yeah, and I think the difference between good intentions and what actually happens is where that role of advice is so critical. For those of who listen to me before, I often say, you know, my husband is my first husband, but I am a second wife. And that means that we do have children of our own, as well as two stepchildren. And one of the most important conversations we've ever had with our wealth advisors, how do we think about structuring a will, and how do we ensure that we are setting things up in a way that is absolutely fair and leaves very little room for difficult conversations, should the unforeseen actually occur.
I know we could keep going on this for quite a while. We'll probably circle back to this. But I want to pivot the conversation a little bit more to divorce, because in the case of divorce, again, this can be a blind side. Or it can be anticipated. But equally and probably more so quite financially devastating. We will come back on the widowhood on sort of the financial surprises.
Kathryn, I want to turn to you and talk a little bit about divorce. What have been some of the lessons that you've learned when you've seen your clients go through divorce? Maybe talk a little bit about some of the things that women wish they knew before that happened.
KATHRYN DEL GRECO: Well, no two divorces are similar. And it depends on whether you were obviously the instigator or if you were blindsided. And I've seen both. So, for clients that are in the position where they are making the decision, I have had conversations with clients prior to that decision being made. And my advice to women, or people in general, but certainly women, is to before you make any initial moves, make sure you do a financial checklist. And make sure that you have a clear understanding of what the household assets are.
And you need to do an entire inventory. You need to know where the bank accounts are and what the balances are. You need to know your real estate holdings and whose name those real estate holdings are in. You need to know where the investment accounts are, who they are with, and what the values are. You need to know where your retirement assets are, that they-- TFSAs, the RRSPs.
You need to know where the life insurance policies are. You need to know details on pensions. There's quite a myriad, business interest, collectibles, art pieces, any asset that has any value. You also need to be very aware of any debt that is being secured against any of your assets. And this is very important for you to gain access while you still have access. Because if you-- this is information that can become very difficult to access once you enter into the stages of separation.
So, go into this very well prepared. Because what you may anticipate being a smooth separation quite often can turn, as we've all seen, quite nasty. So as far as being blindsided, you know, that-- I would actually give the same advice-- is quite often, when I look back at the start of my career 40 years ago when the roles of men and women were still following along the more traditional lines, and depending on the age of the clients, more often than not, men were still in the main driver's seat making the main investment decisions and were likely still the majority breadwinner in the household.
But I will say, I feel very excited and very empowered by the fact that the evolution I've seen over my career is that now I think probably close to 50% of my clients, the women is the major breadwinner. And the woman is the main lead in the relationship financially. So, to me, that is a very exciting development to see occur.
So, I would say that depending on the relationship that you're in, even if your spouse chooses to be the lead, or you've decided that within your household it makes the most sense for him to be the lead on the finances, make sure that you are aware and that there is communication as to where the money is, what the strategy is, are we in sync, are we in agreement.
We all know that, well next to infidelity, that financial stress and money problems are one of the leading causes of divorce. And it's really having a different set of standards and different expectations around how you approach money. So, it's not so much about-- your involvement isn't so much only about protecting yourself in the event of a blind side, but it's making sure that your voice is being heard and that your money and your assets are being managed through the lens of your viewpoint, and your risk tolerance, and your hopes and your objectives with the money as well.
INGRID MACINTOSH: I think when you started the narrative here and we talked about if a woman in your practice came to you and was considering divorce as an option or was seeing this trajectory going, you would be taking her through a level of hygiene that was setting her up almost for that moment of impact, for minimal damage and making sure, and quite honestly potentially could even be a consideration in whether or not to go forward, right. Because it is it's a huge impact.
But what I'm hearing is that this comes right back to the importance of women and women being at the table in partnerships and knowing the full scope of the financial hygiene, if you will, day in day out. So, they are prepared for this. And certainly, I know, my husband and I sit down with our advisor, we would never say, we want to make sure that we're bulletproof for divorce here. That's not the way anybody goes into that conversation.
But again, this part is so incredibly important. So that women are not blindsided. Because if they are, it's going to be an emotional blindside first. And then all of this other complexity is coming down. And how you handle it in that moment and the decisions you make quickly to your point, really have an impact downstream.
Thank you for listening to part one of "Suddenly Single." And please look out for part two coming shortly. In the interim, we invite you to check out the TD Wealth for Women site appended to this podcast description for more wealth advice and strategies for women.
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