Helen White is an expert in building financial capability. She previously led work on the UK Financial Capability Strategy at the Money Advice Service, and has been involved in supporting the Chartered Insurance Institute's Insuring Women’s Futures programme. In this episode Helen tells us about the increasing need for women to build their financial resilience, and we go into detail about how we can engage with beliefs, mindsets and emotions to change people's behavior around money. You can follow Helen on Twitter: https://twitter.com/FinCapHelen Find out more about Talk Money Week: https://maps.org.uk/talk-money-talk-pensions-week-2019/talk-money-talk-pensions-week-get-involved/ And the Insuring Women's Futures campaign: https://www.insuringwomensfutures.co.uk Sign up for updates on the podcast and more: https://tinyletter.com/FeministFinance
You can follow Helen on Twitter, and find our more about Talk Money Week and the Insuring Women's Futures campaign.
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Alice Merry (00:08):
Welcome to the podcast that takes a feminist look at the world of money. My name is Alice Merry and this is the Feminist Finance Podcast.
Alice Merry (00:20):
A few months ago I had the chance to speak with Helen White. Helen is an expert on building financial capability and she previously led work on the UK financial capability strategy at the Money Advice Service. She's also been involved in supporting the Insuring Women's Futures program at the Chartered Insurance Institute. Helen has a wealth of experience across policy, regulation and consumer education and financial services, but I was particularly interested to speak with Helen because of her role in promoting financial wellbeing, particularly among women. I started by asking Helen about her time working for the Association of British Insurers. This is an association that brings together insurance companies in the UK, and one of its jobs is to help customers understand their insurance policies. Helen told me about how her time at the association changed her perspective on customer education.
Helen White (01:16):
I led policy on several different areas in my time there. But the real theme that I picked up over the years I worked there, was the view often of people working in the industry that, if only we could educate people. If only we could get them to read and understand the terms and conditions that we provide for them, we wouldn't have a problem. Everything would be fine. There'd be no complaints, there'd be no regulatory problems. If only we could educate them. What I would often say back to them is, okay, well there's the very obvious point of, you know, I'm sorry but your terms and conditions are far too long and full of jargon and nobody understands them and they're terribly boring and why on earth would anybody read them? But, the bigger point is, you can't simply educate people into changing behavior.
Helen White (02:12):
And this is where I became really fascinated in the work around financial capability, when I found out about it, because the whole concept of financial capability and the UK strategy on financial capability that I was involved in leading is that what determines your behaviors and your experiences with money is not only your skills and your knowledge, what you can be educated on, but actually, even more importantly: what impacts the way that you feel, you think, you talk and you behave about money is your life experiences, your beliefs, your attitude, your mindset around money. And the attitudes, the mindset, the beliefs and the feelings you have about money are very heavily influenced from a very, very young age, by everything that you're absorbing from the environment around you. It's influenced by your family's attitudes and behaviors with money, by, you know, what you see in the entertainment industry, in the media, in adverts and marketing, what you see in social media, what your friends and your peers are doing.
Helen White (03:24):
And therefore you have to recognize that we all make decisions about how we manage our money based on deeply entrenched beliefs and emotions about and attitudes about money. And those are things you can't just educate people into changing. You really have to engage with people emotionally and you have to use very empowering and confidence-building communication messages and methods to really change behavior positively. And then, also building really strong evidence through a lot of piloting and evaluation of the methods, the language, the channels, that are actually effective in positively changing people's money behavior. Because, you know, there have been many, many examples over the years, both in this space and in other, let's say, policy areas where it is assumed that if we, say the government for example, that if government creates this legislationpeople's behavior will change in that way. And many, many examples have been seen where those assumptions are proved to be completely wrong, sometimes disastrously wrong, and in the behavioral response that follows, sometimes it's exactly the opposite of what is wanted. And therefore it's fundamentally important that when trying to positively change behavior in a way that's good for people, you're not make assumptions about what is going to create that behavior change.
Helen White (05:02):
You have to, you have to do testing, you have to do evaluation, and you fundamentally have to build into that methodology how you're going to engage people in the first place. Because you can offer people all kinds of advice and support, but if they're not going to emotionally engage with it and say, "yes, I'm interested, I want to find out more, I want to do something differently", you're wasting your time and money.
Alice Merry (05:26):
I think, in the UK we have quite a strong taboo, don't we, against talking about money, against anybody knowing that you have debt or that you have too much money out on your credit card. It's a really difficult topic to talk about between family and friends.
Helen White (05:41):
Yes. This is a massive issue. You're absolutely right. So when I started the work on the UK financial capability strategy at the Money Advice Service a few years ago, we started to build, what we first called, a financial capability week. So, an awareness-raising week once a year to really raise awareness around financial capability. But then we realized that even that language itself was a problem, because it was quite jargonistic. And so, you know, some of my colleagues had a brilliant idea to change it into a theme around "talk money". Because you're right, one of the biggest problems is we don't want to talk about it. We feel embarrassed, we feel awkward, we maybe even feel ashamed. But if we're not talking about it, we're not solving the problem. We're not changing anything. Nothing changes. Nothing improves until you really start to normalize having conversations about it and to make it a comfortable thing to talk about, without discomfort and shame and embarrassment. So what, what was initially financial capability week is now an annual Talk Money week and it's really building quite a lot of momentum.
Helen White (06:56):
And you may have seen one of the banks has recently started running a series of adverts which are addressing precisely these problems, filming couples or family members or even friends reflecting all the discomfort they feel about talking about money, but then showing them sort of move on in their thinking about it and realize that it is a very healthy thing to talk about money.
Alice Merry (07:19):
It's real, isn't it? I mean you feel awkwardness to mention if you have problems and you feel awkward to mention if you do well.
Helen White (07:25):
But yeah, that's quite a British thing. It's not the same in a lot of other countries and cultures. So I learned a few years ago, for example, that in Hong Kong, it's a, not just a normal, but almost a thing that almost everybody does, is to invest. Investing is something, it's almost like a national competition. You know, everybody believes in the importance of investing, everybody does investing, you know, that's a very different cultural mindset to what we have here in the UK, where for many people, you know, investing isn't for them. It's not what they do. It's only what rich people do. So we have to realize that these things can change. They're not human mindsets. They're just specific to our particular culture and these mindsets, you know, they can be changed quite quickly. Particularly today. You know, given the power of social media, you know, there's actually enormous potential to change mindsets and attitudes and beliefs quite quickly and quite positively.
Alice Merry (08:23):
What kind of messages would you like to see going out to change attitudes and change beliefs as you say? What kind of messages would you like to see, particularly women receiving?
Helen White (08:34):
I would like the messages that women receive around money to be very much engaging, emotionally engaging, empowering, confidence- and trust-inspiring, but also very much encouraging women to build their financial independence and their financial resilience. Because what we are seeing from research these days is that the financial risks that women facing or women are facing are actually growing.
Helen White (09:10):
So traditionally, you know, women have relied very much on a variety of financial safety nets through some combination of, you know, their father or husband or the state. But, due to the changes that are happening in culture and in society, those safety nets for women are falling away. Many more women are staying single, or not getting married but co-habiting, or marrying but divorcing. And so those traditional safety nets aren't really there anymore in many cases. But women are still facing a lot of biases, a lot of stereotypes, a lot of unfair and unrealistic expectations. And the two are just not matching up at the moment. So, for example, women are still expected to do the vast majority of caring for children and they're expected to take time off work or work part-time or work flexibly or be less ambitious in their careers so that they have the time to put into child caring. Whereas that pressure is still not being applied to men. And that is still having an enormous impact on women's ability to build their independent financial resilience, particularly impacting on women's ability to save in their own pension.
Helen White (10:26):
And unfortunately, it is the case now that relationship breakdown and separation is very, very common. But because women take time out of work often or take jobs that result in them earning less money, that severely impacts the pension savings they build up through life. But unfortunately a husband's or a partner's pension is often not there for them to fall back on later in life when they need it.
Alice Merry (10:51):
What impact does that have on women through their lives financially? What state are we seeing women get to by the time they're hoping to retire?
Helen White (10:59):
Well, if we start very early on, we are still seeing a lot of stereotypes and a lot of beliefs and expectations and biases around women in terms of what type of job they choose to go into and therefore, right from the beginning of their working lives, that's impacting the income that women earn. We are even seeing that, if you compare women and men at a young age going into apprenticeships, typically women are choosing apprenticeships that pay less money than the apprenticeships that typically men choose. So, right from the outset, women are facing a financial challenge. That also means that if women go to university, for example, and we're all unfortunately building up debt these days, if we do go to university, because women then tend to choose jobs which are again lower paid than typically the jobs that men choose to go into, it can take women three times as long - up to 30 years - to pay off student debts.
Helen White (11:58):
Then you get to the stage where women and men start to form serious relationships, start to move in together and start to make decisions about how they manage their money together. And one of the key things I would urge women to think very carefully about is the decisions that they make with their partner about how they manage their finances together. Because very often we are cohabiting now, we're not marrying, we're cohabiting. And the impact of that is that once you separate, you have no financial rights, for example, to your partner's pension, even if you've taken years off work to look after your and your partner's, children. So that cohabitation pattern in life is having an impact on women's finances as well.
Helen White (12:48):
But motherhood is certainly the greatest impacts because, as I've already said, women are still expected to do the vast majority of caring for children and also increasingly caring for elderly parents and relatives. And that means that women are working less hours taking lower paid jobs taking jobs perhaps where they have less pressure and less responsibility so they've got that greater flexibility to leave if they need to because their children or their elderly parents need them. But that means that they are not building up their independent financial resilience. They are still relying consciously or unconsciously on their parner being there to look after them financially later in life as the quid pro quo, if you like, for being the one who looks after the children and looks after the parents. But, because of relationship breakdown and separation and divorce, women are finding later in life that they haven't built up much in the way of their own pension savings. They have sacrificed their pension savings for their family and for their partner. And they don't have the pension savings that they need later in life, whereas their partner probably hasn't reduced their working hours, or their pay, or their pension savings, whilst they've had young children so their pensions are just fine.
Helen White (14:03):
And, and what we know is that even in marriage, where you have a right potentially to some of your partner's pension, seven in ten couples divorcing don't even discuss pensions and therefore it just doesn't come into the settlement that's reached around divorce. And so many women are reaching later life and finding themselves in severe financial difficulties, even poverty, because they simply don't have those pension savings behind them. And of course, women tend to live longer. We tend to be around to look after our partners but, you know, once they're gone, we're on our own, there's nobody to look after us, we therefore more often need to move into a care home and we're likely to be there longer. And therefore the costs of paying for a care home later in life are typically much greater for women than they are for men - quite significantly greater. But we tend to have less savings and less assets to pay for them. So we're seeing some very, very serious risks in the pension, the gender pension gap between men and women.
Alice Merry (15:06):
So as we see that women are facing these evermore complex risks throughout their lives and the traditional safety nets for them are falling away, how do you see the financial sector responding to that reality?
Helen White (15:20):
The financial services industry is gradually waking up to this, and I would say gradually getting better, or at least, some companies are moving further ahead than others in terms of better in communicating with and engaging with women and better designing products and services to meet women's needs. But there's still a long way to go and fundamentally that isn't really going to be achieved until there is genuine equality and diversity around gender and race at all levels throughout companies in the financial services industries. Because essentially the important decisions around product design and service design, you know, are made at relatively senior levels and therefore if there aren't a greater diversity in terms of gender and race and ability at those senior levels, those decisions won't reflect the needs of everybody across society.
Alice Merry (16:13):
Could you give any examples of kind of poor decisions or product features that might have been made by a group of men thinking this is a great idea, but then in reality for women or for different groups of women really don't work?
New Speaker (16:28):
Well, we've seen examples of marketing campaigns, let's say, by insurance companies that were very deliberately designed to reach out to and engage with women, but actually were very patronizing and women didn't respond positively to that. They felt patronized. So they were trying to do the right thing, but they made certain assumptions about what would work, engaging women and, and they got it wrong. We also see examples in insurance products sometimes where again, it's assumed that you're living as a couple and you will stay as a couple. And what it's not taking into account is that if and when you separate as a couple, that insurance has been in one person's name, because generally they only allow an insurance policy to be in one person's name, typically - it depends on the insurance product - but, typically, for example, car insurance, if you then separate and only one of you can take that policy with you and the other has to take out a separate policy, often the person who'd can't take that policy history with them finds that suddenly the costs they are facing to replace that policy for themselves are very much greater, because they don't have the history of having that insurance contract for a very long time and therefore they're treated as a new customer with an unknown credit and unknown insurance risk, essentially. And therefore their risks rated more highly. So there needs to be a rethinking of how products and services are designed to reflect the reality of life that we may form as a couple, but we probably won't stay together as a couple for the rest of our lives or in many cases won't, you know.
Alice Merry (18:15):
That's really interesting. I think the insurance industry is a bit notorious for not being very well adapted to the reality of modern life and modern families. Like you mentioned, it doesn't really know how to handle the fact that couples don't stay together necessarily. I think it's can be really challenging to get insurance if you're an LGBTQ couple, if you're an immigrant... I think there's definitely a lot of adapting for the insurance industry to do to the reality of families and life.
Helen White (18:45):
Absolutely, I mean, you know, the insurance industry are absolute experts at collecting and analyzing data to assess risks. The trouble is the assumptions on which the data is collected and analyzed often fall behind the realities of modern life. And, that's often because people who work in industry are not a diverse representation of the society that it's seeking to serve. So those assumptions are sometimes out of date and misplaced. It's getting better. I mean, I think most of the industry really wants to do better and is trying to do better, but it is, it is a bit of a slow moving Titanic-type ship.
Alice Merry (19:34):
What does give you hope in the insurance industry?
Helen White (19:39):
Well, at a very simple level, the industry over the last few years has been talking about these issues an awful lot more. Now, talking doesn't change behavior, but it's the starting point. You know, there has to be a much greater, open, honest self-challenging discussion about where it's falling short in serving society and what it needs to do better. What I'm really seeing as a very optimistic sign is that there are actually quite new innovative insurance companies coming out and, and for quite a long time, it was assumed that it was almost impossible for a new insurance company to establish itself, because you've got such enormous insurance companies in the market and there are very, very high cost to creating a new insurance company and entering the market. But, over the last few years there have been some newer innovative insurance companies who really want to do things differently. And if you are not held back, if you like, by the sort of Titanic that is a big long-established insurance company and all of it's complex systems that it has to maintain, when you create a new company, you really can start a fresh and be a lot more innovative and nimble. So yes, there are signs of change out there. Definitely.
Alice Merry (21:06):
Do you think, these new companies, do they have more diverse leadership?
Helen White (21:11):
Hmm. Not diverse enough. I mean well-meaning and some degree of diversity, but of course they're typically set up by people who've worked in the insurance industry for a long time.
Helen White (21:27):
I mean there is also, you know, there has been, over the last few years, a lot of debate and a lot of pressure about increasing representation, particularly of women, in the financial services industry. You know, there's been a big women in finance report from parliament. There's the women in finance charter, a lot of companies have signed up to and committed to. But you know, this is just the first step. It takes time and a lot of commitment to really achieve that change. I think one of the challenges that these companies need to overcome is treating this kind of change, in terms of creating real diversity at senior levels, as a top priority for a company. Not just a nice to have.
Alice Merry (22:16):
I'm going to ask you the final question, which is, what would a feminist financial system look like to you? If I could give you the power to kind of click your fingers and redesign the system in any way you like to work for women, what would you put in place?
Helen White (22:33):
So I've got two points here, and if we focus on the fact that feminism is about achieving genuine equality between men and women, not about men's, you know, supremacy over women being reversed, but actually creating genuine equality. So for me, there's two aspects of this. One is we have to create genuine equality and diversity in the design and the decision making at all levels and in all functions of all organizations involved in the financial system, so that decisions taken, products and services designed and delivered, and legal and regulatory systems all operate with a real understanding of women's lives, challenges, needs and wants, and that organizations operate and communicate in a way that doesn't favor men over women or favor white people over black people or favor able-bodied people over those with disabilities. We have to create that genuine equality and diversity at all levels and in all functions, so those decisions reflect the realities of what everybody across society needs and the diversity of those needs.
Helen White (23:45):
The second point, it comes back again to something I've mentioned already, which is, you know, we are not going to achieve real parity and equality financially between men and women until we address the biases, the discriminations, the stereotypes around parenting and other caring responsibilities. Because until those responsibilities of caring for children and caring for elderly parents are genuinely shared between men and women and the financial impacts of those are genuinely shared between men and women, women are not going to achieve the financial equality and independent financial resilience that they need. And that requires a real attitudinal change across our society and particularly on the part of employers, and we need our employers and our employment system to genuinely, not just tolerate, but actively support men and women as parents to genuinely share those caring responsibilities and the financial impacts of those caring responsibilities. Those are my two key things for achieving a feminist financial system and a feminist financial society whereby we all have real equality in our financial opportunities and our financial resilience and wellbeing.
Alice Merry (25:23):
I was so interested to hear what Helen had to say about how surprisingly quickly we can change both individual mindsets and our collective cultural mindsets around money. And that's really one side of the coin. How we can change women's approaches, beliefs, emotions around money so that they're better able to protect themselves and create their own financial security. And the other side of the coin of course, as Helen talked about, is financial services companies making it a top priority for their leadership to be diverse, so that we have the leadership in the sector that we need to cater to our diverse population. Thanks so much, Helen, for for sharing that. You can find Helen on Twitter and I'll put a link in the show notes. Please do also subscribe to the podcast and subscribe to the feminist finance newsletter. I'll leave a link in the show notes. And please rate and leave us a review. See you next time.