WOMEN ON A LEVEL PLAYING FIELD WITH MONEY

by Divora Mehari | Mar 11, 2022 | Financial Literacy

HOW TO GET WOMEN ON A LEVEL PLAYING FIELD WITH MONEY

Friday, March 11, 2022

The gender pay gap in Canada has been an issue for decades. Women across various industries and professional levels have been experiencing economic inequality. According to Statistics Canada, women earn $0.87 for every dollar earned by men. Alongside the wage gap, there continues to be ongoing societal factors that perpetuate women being left behind when it comes to financial literacy and wellbeing.

We had the opportunity to sit down with Kim Boudreau, Certified Financial Planner at YNCU, to discuss how financial professionals can help women become more financially independent and access the same financial literacy opportunities as men. Kim shares her knowledge about the history of women and money, why women are not on the same playing field as men, and what can be done about it.

The History of Financial Inequality

In the past, women have had no decision-making power when it comes to household finances. The world consisted of traditionally male-driven workplaces and households. Dating back to the 1700s, women had no autonomy. In marriage, they simply became the property of their husbands. It wasn’t until the 1800s when the Married Women’s Property Act was passed, allowing women to own properties, assets and keep their own income.

In the 1960s, the Equity Pay Act was passed in an attempt to create more fairness in income, based on gender. In the 1970s, the Equal Credit Opportunity Act prevented credit from being denied to women on their own merit. Although we’ve come a long way, women today still lack the same financial independence and opportunities provided to men.

Kim says she still has clients who talk about the days when they were not able to get a loan or mortgage without their husbands co-signing. While men could do everything on their own merit and did not have to include their wives, women have faced challenges in their journey toward earning respect as financial equals to men.

Where Are We Today?

The representation of women in the financial industry remains an issue, especially in roles above entry-level. According to Deloitte Insights, women still only make up 24% of leadership roles within the financial services sector. Having more women in these leadership roles will help improve financial outcomes and bring in unique perspectives and ideas. It will also create mentorship opportunities for future generations.

To get to this point, it’s going to take time and proactive effort. Some effective ways for women to advocate for themselves include: education, asking questions, attending meetings, participating in discussions, meeting with other women to share ideas and create solutions and growing their confidence.

How Can We Do Better in Promoting Gender Financial Equality?

Promoting gender financial equality needs to be a collective effort in order to raise awareness and drive change. Some of the many ways financial professionals can help include: being more inclusive, asking questions directed at female clients, offering learning sessions, taking time to explain financial terms and encouraging them to ask questions and explore new resources.

Partners, family and friends can also do their part to help promote gender financial equality by encouraging women to be involved in creating and building their own financial stories. This includes understanding statements and accounts, balances, credit, retirement plans, debt and long term security and protection.

Where Do We Still Need to Go?

Although women are learning and becoming more involved with their own finances, Kim has noticed that many of her clients still defer decisions on investments, income, retirement planning, insurance and pension decisions to their spouses. This is detrimental, due to the fact that most women traditionally outlive their spouses, meaning financial decisions will impact them in the long term. Moving forward requires us to include women in discussions surrounding finances and respecting them as equals to men. This will help women feel more empowered and confident in managing their own money.

Financial Management Tips for Women

The following are some key tips and recommendations Kim shares for women looking to be better with their money:

Ask Questions

Take the initiative to meet with your financial advisor to go through everything and ask questions.

Learn The Basics

Learn how your emotional history, experience and needs are affected by money and what you’ve learned by watching your parents and family members.

For example, if money caused stress or family strain, it was likely not a topic of discussion. Whereas, if money was plentiful and opportunities were endless, then you may have been led to believe that someone would always take care of things. Learning from your own experiences can help avoid any biases based on how you were raised to perceive money matters.

Get Involved

It’s important to get involved and speak up when making important decisions and sharing opinions, thoughts, needs, concerns, wishes and ideas. Financial advisors are always open to setting up a secondary meeting if you need any further information or would like to expand your knowledge on certain topics.

Manage Your Own Accounts

Women are encouraged to manage their own accounts, especially their retirement accounts and TFSAs, and not to defer all decisions to a spouse. It’s also important to use online access to banking information, read statements, ask questions and provide feedback.

Over the past 15 years, Kim has seen several women lose their spouses in situations where those spouses had already made all of their decisions regarding money. Now these women have to manage the emotional distress of losing a spouse and sort through the details of what should be done about a pension, home, the family and a new income, when they often were not involved in any discussions and planning surrounding family finances.

Kim has sat across from many worried, upset and shocked women who have to learn this all at once. It can be stressful, intimidating and upsetting for many, but she has also seen some women become empowered, sell homes they never liked, and buy ones they love. She has seen women start over, grow their assets and provide a new life for their family. These women were able to create a new monthly cash flow and imagine a life where they’re able to decide how to spend their retirement in ways they once did not think possible.

It all begins with trust in yourself, trust in a strong financial advocate and collaboration with a financial partner who can support your vision of what you want your life to be. If you have any questions or would like to talk to Kim, she can be reached at [email protected] or P: 705-942-3008 M: 705-206-2505.

Did you know that the financial industry also faces the issue of racial inequality as it relates to money? To learn more, check out our blog, Sharing Resources: Exploring Racial Inequality & Money.

PROMOTE FINANCIAL EQUALITY

by Divora Mehari | Feb 18, 2022 | Financial Literacy

HOW TO BE AN ALLY TO PROMOTE FINANCIAL EQUALITY

Friday, February 18, 2022

Our previous blog explored financial inequality and the various societal factors that cause and perpetuate this issue. We had the opportunity to speak with YNCU’s Systems Administrator, Rabo Oshobe, about how members and financial professionals can take direct action. Rabo shares his expertise and helps us understand how to better address financial inequality, promote access to resources and improve financial literacy.

How can we support each other?

Supporting each other starts with understanding each other’s struggles and experiences. Rabo came to Canada when he was 19, after growing up in Nigeria where wealth inequality is very extreme. His father came from a poor family and his mother was able to start a business with just a high school diploma. Rabo’s father taught him the importance of education and how to apply what he learned to obtain a steady paying job.

Most people in Nigeria have not built generational wealth, which significantly impacts how people manage their finances and their interest in financial education. Rabo was shocked when he came to this country, noticing the wealth made in Canada stays in Canada. Many Canadian children have instant access to generational wealth. The money simply gets spread across family members and passed on to kids and grandkids.

The Black population now accounts for 3.5% of Canada’s total population and the majority of those working in finance are white. This places a bias on the advice and support given to the community. When Rabo arrived in Canada as a student, he wished someone would have reached out to teach him how to manage his finances. Financial literacy isn’t something that’s taught in schools, and general financial advice tends to exclude the needs and concerns of younger demographics. As many others share similar experiences to Rabo’s, more needs to be done to provide better support and access to resources.

How do we recognize financial inequality?

In order to recognize financial inequality, we need to consider different lifestyles and backgrounds. This ensures all groups and individuals receive the financial education they need based on their situations. We need to target minority families with programs, loans and education to help them get to where they need to be. Not only is this good for the economy, it allows the children in these families to get the education and opportunities they deserve.

How can we be better allies in promoting financial equality?

Having open conversations about money with your friends, family and colleagues is a great way to promote financial equality. Being open about what you earn, how you invest and your money management strategies can help those who may not have the same financial knowledge. In today’s society, community-based spaces like social media allow us to learn and share ideas when it comes to finances.

Who do we need to call on to drive change?

Not until we have a strong financial framework built into our education system will we start to see change. Ideally, we would see school systems stepping up and championing this important initiative. Financial education should be offered in schools and at all levels of education. It should also be free and readily available to everyone. Teaching children how to financially support themselves from a young age could go a long way in helping us drive change.

Whose voices need to be amplified?

The voices of minority groups need to be amplified. Historically, underrepresented people have less access to financial resources and are therefore less likely to build generational wealth. When given the opportunity, minority communities are eager to share what they know and what they have with each other in terms of resources, knowledge and money.

An amazing example of this was when the community came together to raise money for Rabos’ father to be the first to go to school in their village. This allowed him to get a good job and in turn give back to the community. The spread of wealth has a significant impact on these communities and their success.

For financial professionals, what needs to be done as an educator in this space?

If we want to drive change, we need financial professionals who are willing to openly share their skills with those who reach out from other countries. We need more people going out into the community and in classrooms to reach all groups, especially younger generations. Information should be broken down in a way that is easily understood and accessible. We should also encourage people of all cultures to have these conversations with their kids so they can get a head start with their finances.

Rabo is so grateful for the amazing team at YNCU for giving him the opportunity to work there and learn more about finance. He immediately felt welcomed by the YNCU team. He also feels his personal experiences were met with empathy and understanding.

We need more compassion when it comes to finances. Feel what people feel, match their motivation and try to understand where they are coming from. Money and mental health are heavily intertwined, therefore financial education and literacy has the potential to significantly impact someone’s life for the better.

Addressing financial inequality will take time and effort. This issue needs to be recognized by those affected by it and those who benefit from it. Not until we all have equal access to financial education and resources will we start to see true and lasting change.

To learn more about racial inequality as it relates to money, check out our latest blog, Sharing Resources: Exploring Racial Inequality & Money.

EXPLORING RACIAL INEQUALITY & MONEY

by Divora Mehari | Feb 4, 2022 | Financial Literacy

SHARING RESOURCES EXPLORING RACIAL INEQUALITY & MONEY

Friday, February 4, 2022

Centuries of institutional and systemic racism have led to a significant disparity between the wealth of white individuals and those who identify as visible minorities.

Wealth is about more than a paycheck — it refers to the sum of financial assets and physical possessions owned by an individual or family. Less wealth means more challenges with homeownership, investment opportunities, student loans or the ability to pass accumulated wealth down to future generations.

To better understand racial inequality as it relates to money, we will explore the following questions: What is the racial gap? What are the historical impacts of racism? And what are ways to overcome these challenges?

What is the racial wealth gap?

The racial wealth gap is the difference in wealth between white and non-white households. This gap has been growing wider for decades, especially during the COVID-19 pandemic. Other contributing factors include:

• Limited educational opportunities
• Inheritance
• Discrimination in housing and employment

A report from The Conference Board of Canada states that, for every dollar earned by a white worker, visible minorities earn on average 87.4 cents. This difference in wages, among other disadvantages, can impact opportunities such as one’s ability to save or invest. If left unaddressed, this could result in continued imbalances between certain populations, leading to severely imbalanced wealth distribution.

Elements of family-wealth generation

Generational wealth, or family wealth, is a term used to describe the accumulation of assets from one generation to another. It can include income, savings, investments, and property. Building generational wealth allows families to provide their children with more options in life.

For example, if your family is able to help pay for your tuition, this takes away the stress of paying down a student loan debt and provides you the opportunity to save for your first home or retirement. Generational wealth has the potential to significantly impact one’s financial future. This is why it’s so important to address the wealth gap so all families, no matter their race, can provide financial stability for generations to come.

History of racial inequality

The history of racial inequality in Canada is long and complex. It has been influenced by many factors, including the country’s colonial history, laws, policies, economic decisions and social movements. Racialized communities are still dealing with the repercussions and will continue to until change is made.

Recent census data from Statistics Canada reveals “black Canadians make significantly less money than non-racialized Canadians regardless of how long their families have lived in Canada”. Racism is ingrained in our history. It will take time and effort to begin to unravel these deeply rooted systems.

Addressing the racial wealth gap

The racial wealth gap is a persistent problem in Canada. The Canadian government has taken steps to combat the issue, but there are still many aspects of the problem that need to be addressed. The first step is to create policies and laws that ensure equality and equal opportunities for all Canadians.

The second step is to ensure economic decisions are made with equality in mind. This includes ensuring people of all races have the same access to jobs, housing, education, and other benefits.

We will never undo centuries of discrimination, but there are steps we can take to create change. The wealth gap is the product of systemic policy choices, and it’s going to take intentional policy interventions to make any significant progress in closing the gap.

Although we’ve come a long way, there’s still so far to go before we start to see true change. There are a wide variety of sources that provide further insight into the racial wealth gap and the disparity in Canada. We encourage you to further your research to learn more and continue to have these important conversations.

Ready to get started? Here’s a list of great resources regarding income inequality in Canada:

The Racial Wealth Gap is a Problem
Canada’s Colour Coded Income Inequality
Colour of Poverty — Colour of Change
Income Inequality
By the Numbers: Race, Gender and the Canadian Labour Market
How the Economic Landscape is Tilted Against Black Canadians

HOW TO ACHIEVE YOUR FINANCIAL NEW YEAR’S RESOLUTION

by Divora Mehari | Jan 21, 2022 | Financial Literacy

HOW TO ACHIEVE YOUR FINANCIAL NEW YEAR’S RESOLUTION

Friday, January 21, 2022

Getting in shape, eating healthier, and breaking bad habits. They’re all popular new year’s resolutions. But this year, thanks to the ongoing COVID-19 pandemic, improving our financial health is climbing closer to the top of the list.

The pandemic is taking a toll on our bank accounts. But there are ways to get back on track. Let this year be the year to rethink your spending habits, improve your budgeting and start saving!

Here are some tips to help you achieve your financial resolutions:

1. Start small with SMART goals

Improving your financial situation can be an overwhelming endeavor, so we recommend aiming for small improvements while setting SMART goals: specific, measurable, attainable, realistic and time sensitive. When you set goals that satisfy these conditions, you are more likely to achieve them.

Starting off with a short-term goal can also be a good way to start the new year with less pressure. Short-term goals are easier and faster to obtain. They also allow you to see your progress faster, which can lead to higher confidence and a greater chance of remaining committed to a long-term goal.

If you’re in need of a smaller and simpler financial goal this year, we recommend focusing on your monthly spending. Setting a monthly budget allows you to spend less than what you earn. Over time, a budget can help you cut back on discretionary spending or rely less on credit cards, leaving you with more cash at the end of every month.

Learning to live below your means is a small but smart way to save more money sooner and live debt-free. Ready to get started? Download a free copy of YNCU’s financial goals worksheet to start planning your goals today.

2. Pay yourself first

Want to see your savings grow faster this year? One of the best ways to prioritize savings is through automatic transfers.

“Pay yourself first” is a popular phrase in personal finance and retirement planning. It involves automatically deducting a fixed amount of money on a regular basis from your income or other money sources and depositing it directly into a savings account.

For example, if you no longer have to make regular car payments, we recommend diverting that money into a savings account. When something is automatic, we are less likely to treat it as an option and it becomes part of our regular saving and budgeting routine.

This system is an effective way to manage your spending habits and contribute to future expenses such as your retirement fund or emergency savings. Automatic transfers can be set up yourself, through online banking or we can help.

3. Focus on cutting down debt

It can be easy to go into debt, but it takes time and self-discipline to pay it off. Now that you know how to set SMART goals, we encourage you to use this tactic when it comes to paying down debts such as credit cards, lines of credit and student loans. This will make it easier to manage your income, you’ll avoid hefty interest down the line and you’ll have more freedom with your cash.

If you have outstanding balances on multiple credit cards, a realistic goal would be to pay down the card with the highest interest rate. Known as the “debt avalanche” method, this strategy involves making the minimum payment on all debts, then using the extra funds to pay off the debt with the highest interest rate. Another tip to consider is paying more than the minimum balance. This will help you eliminate debt sooner and decrease the amount of interest you owe.

If you’re still unsure where to start, reach out to your local YNCU advisor for guidance.

4. Introduce good financial habits

Be honest. When was the last time you took a good look at your spending habits? Is there a streaming service you never actually watch that you could do without?

Kicking the year off with healthier habits and routines is a smart way to take back control of your finances. One financial habit to commit to this year is “no-spend” days. These are days where you don’t spend any money. It simply means deciding to make a coffee from home that morning or holding off on that online purchase. With the majority of us now working from home, incorporating no-spend days into your weekly schedule is hopefully a little easier.

If you’re worried about your finances, our team is here to help! Book an appointment online to meet with one of our experienced financial advisors who will design a custom plan to meet your needs.

Want to track your spending and hold onto more money? YNCU’s household budget tracker is a great resource to help you take control of your spending. You can also check out our latest blog, “How to Build a Better Budget.”

EMPOWER YOUR FINANCIAL FUTURE WITH A CREDIT UNION

by Divora Mehari | Oct 31, 2021 | Financial Literacy

EMPOWER YOUR FINANCIAL FUTURE WITH A CREDIT UNION

Monday, October 31, 2022

October 20th was Credit Union Day! To honour this day, we wanted to share with you some background on credit unions and how YNCU makes an impact on the lives of our members.

Did you know the first credit union in Canada was nicknamed “the people’s bank”? This is because credit unions have always been centered around a cooperative model, where members are able to make decisions about their money. Credit unions were created with the specific intention to meet societal needs. They are focused on their members’ financial well-being. These financial institutions are very different from traditional banks. They can do things a bank can’t and care about the things they don’t, like keeping your money local.

Here are a few of the reasons credit unions can benefit you over a traditional bank:

• Credit Unions are focused on their members’ financial well-being because they were designed to meet a societal need.
• Credit Unions have some of the best rates and deposit protection in the industry.
• They put your health, the health of your community, and your local economy ahead of some investment banker’s bottom line.
• The focus is on putting your interests first because you are a member.

Every person who does their banking at a credit union is also a member of that credit union. Once a year all the members are invited and entitled to vote on a one-member-one-vote basis to elect the board of directors, who is ultimately responsible for overseeing the credit union. The board does not have an incentive to seek excessive profits to serve a shareholder as any profits are derived from the customers who are also members. Credit unions do need a profit to ensure the organization meets legal requirements related to having a buffer against bad years. However, the credit union’s pursuit of profit is in service to the organization and its membership, not a goal in itself.

Profits have never been a part of credit union values. They have always been focused on their members and the community in which their members live and work. Credit unions look at the whole picture and work to build long-term relationships with members to provide customized growth strategies that actually work to meet your goals.

At YNCU, we work hard to keep the values of what a credit union is meant to be. We are constantly engaging with our members and community. International Credit Union Day celebrates the spirit of the global credit union movement. The day is recognized to reflect upon the credit union movements and history, promote its achievements, recognize hard work and share member experiences.

For all your general financial inquiries and how you can plan out your financial goals, come talk with someone at your YNCU branch!