Managing her money used to terrify Barbara Stanny, daughter of H&R Block co-founder Richard Bloch.
“I was brought up believing that the men made the money and managed it. My father's message to me, which was very much a message of his generation, was ‘Don't worry.'”
So even when Ms. Stanny's husband began gambling their money away, the California woman stood back.
After the couple eventually divorced, Ms. Stanny was forced to face and understand her money for the first time.
She resuscitated her finances and, in 1999, penned Prince Charming Isn't Coming, a bestselling financial tome for women. When her father read the book, he hastened to illuminate his wife on their finances.
“By the time my father died five years ago … my mother knew exactly where everything was. All she had to was grieve,” said Ms. Stanny, who now coaches women on money.
Many of the victims taken in by Bernie Madoff's Ponzi scheme were aging widows who grew up in an era when women received allowances from husbands for the household expenditures, then later entrusted their investments with husbandly figures such as Mr. Madoff. Now other widows are claiming a similar charge against Earl Jones, a Montreal financial planner alleged to have swindled investors – many of them seniors – out of $50-million.
Even on the perpetrator's side, older women have been blasted for ignorance: Victims have vilified Ruth Madoff for her apparent obliviousness to her husband's financial dealings. (Now the public is picking over her every monetary move – from clipping coupons and her dumpy new apartment, to dinner at a middle-of-the-road pizzeria.) While some experts say old habits die hard, others insist that it's unlikely today's female breadwinners would be duped the same way. Well beyond the daily household spending, women now have a greater hand in the family finances. Many aren't coughing up their earnings for a spouse to invest on their behalf, and some are running the entire purse themselves, with mixed reaction from their partners.
“Women of today's generation, the daughters or granddaughters of these [victimized] women, most of them will not be taken in by this,” said Ann Frost, associate professor of organizational behaviour at the University of Western Ontario's Richard Ivey School of Business.
Aside from earning their own salaries, women are marrying later: “They're taking care of their own money for much longer before they have a husband,” Prof. Frost said.
Women managing their money is a relatively new concept in our “collective unconscious,” Ms. Stanny said. Until about the mid-seventies “women could not get a credit card or open a bank account unless their father or their husband co-signed.”
It was not for lack of ability that they didn't involve themselves in the process, said Patricia Lovett-Reid, senior vice-president at TD Waterhouse Canada.
“You fall into family pattern and routine that plays to what you perceive to be your strengths, and that helps the household move more efficiently. There was a certain element of comfort.”
And often, when a husband died, that extended into forking investments over to an adviser, with little oversight. The typical thinking is that “it's just a relief to move on,” Ms. Lovett-Reid said.
That attitude endures among some women today, but those who still choose to abdicate financial responsibility to their spouses are taking enormous risks, she said.
“We still live longer than our male counterparts. In some cases we're still earning less. Women leave the work force earlier and that could compromise government benefits or even their pensions,” Ms. Lovett-Reid said.
“Not only will they not be comfortable, there's a tremendous amount of anxiety around not knowing where you stand financially.”
Money coach Olivia Mellan said the hesitation persists despite the fact that women's portfolios often outperform men's, largely because they take fewer risks investing.
“Once women get on board, they get much better investments than men: They buy and hold, they don't act on tips from friends, they're not hoping to get something for nothing,” said Ms. Mellan, author of Overcoming Overspending: A Winning Plan for Spenders and Their Partners .
The good news is that the gender disparity appears to be shrinking.
“What you're seeing in the financial realm of households, whether it's with a partner or a committed long-term relationship, is a lot more equal footing and open communication,” Ms. Lovett-Reid said.
Ms. Stanny puts it a different way: “I'm seeing a tendency in families for there to be a partnership where the wife doesn't just give it over.”
But in some cases, women managing the family's funds has left men feeling emasculated. There can be tension between the spouses when a wife or girlfriend decides to step in, Ms. Lovett-Reid said – especially if the woman has a different “money mindset” than the man.
“If you haven't broached the subject all along and all of a sudden you want to, there's a territorial feeling. … [But] once the conversations start to flow, there's almost a feeling of relief from the partner who has been managing it to say, ‘I'm not in this alone.'”
“All this is freeing men too,” Ms. Stanny said.
Ultimately, hectic schedules are playing into the hands of fraudsters more than gender or age, Ms. Lovett-Reid said.
“Time is an issue. That's where these types of things can happen, because you haven't taken it a step further by asking for those valid [company] references and then calling them.”
And she cautioned against painting aging widows as the only Ponzi chumps.
“There's no typical fraud victim in Canada,” she said, pointing out that people who don't feel vulnerable are often the ones exploited.
Ms. Mellan concurred: “Financial planners dealt with [Madoff]. They weren't money shy. If the crook is a good enough crook, they can get just anybody.”
