Ps & Qs of Dollars & Cents

Written by Jan Jaben-Eilon Friday, November 11 2011

Snapshot: Teresa Dentino, CEO, The Financial 411
Teresa Dentino is founder and CEO of The Financial 411. Unlike other financial firms, there are no investment sales and investment management, even though she has a financial professional’s credentials. Her firm was the first platform to be sales free and strictly educational. She is a former Financial Industry Regulatory Authority (FINRA) General Securities principal with 26 years of professional financial services advisory and board-level experience. She was one of the pioneers of financial education for women, starting in 1985 when she became one of the first female stockbrokers in the country. She also provides content development, event production, and staff training for money managers and financial firms that aim to initiate or increase their financial literacy programs and outreach for women. She is an established expert in women’s relationship and behaviors around money.

Dentino wrote a book to help women master the critical elements of their financial lives and avoid the wasteful financial and emotional costs associated with limited financial engagement. She lives in Woodside, Calif.

Womenetics: Why did you found Financial 411? What need did you see for this type of company?
Teresa Dentino: Having already worked for 16 years as a financial adviser at the major firms, I recognized from the onset that women had no access to relevant financial education; that they weren’t even part of the dialogue. I also knew that they would – through their longevity – likely end up with responsibility for complex financial assets and decision-making. That was why I started developing and presenting financial education geared to women as soon as I got in the business in 1985. It was unheard of.

By 2001, when I founded The Financial 411, not much had changed with Wall Street – other than women were now recognized as separate investors (versus the wives of their clients). But there was nothing on the landscape like the platform I created with my firm – that is a qualified financial professional creating and delivering financial education and training, exclusive of any investment sales or investment management services and that was appropriate to women’s needs and concerns. It filled a huge gap and need.

Womenetics: How do women’s financial needs differ from men’s?
Dentino: Our longevity (versus men’s) creates different needs. The most obvious consequence is living longer in retirement, thus potentially higher health care costs. Also, through default, nine out of 10 will find themselves having to assume full financial decision-making responsibility (widowhood and divorce the main drivers, among others) often without adequate preparation.

Some other differences: A higher percentage of women than men work for nonprofits where retirement and other employee benefits are lower versus those in the for-profit sector, and that’s not to mention lower earnings. Women often bear the cost of leaving the work force for “caretaking” events – another setback to earnings – retirement benefits, and career opportunities. Women also, statistically speaking, think of investing as yielding “just enough to get by” and are much more likely to be financial “enablers” (with grown children, for example). Since we know from studies that women’s retirement account values lag that of men’s, these traits and trends are problematic and magnified when considered in light of the greater longevity factor.

Womenetics: What do you mean by “financial literacy engagement?”
Dentino: Financial literacy is all encompassing and relates to both your personal finances as well as investing. What I mean by engagement is that the way to get better at it is to continually be proactive – taking that next step, whatever may be required for your particular situation. It also means for married women to stay tuned in to what’s going on with the family finances. It means not hiding your head in the sand and not buying into the myth: “Women can’t do math.” It’s not really about math; the calculator will do any math that needs to be done. It’s more behavioral and relating to habits and attitudes than being a math genius.

It also means not deferring your power to your husband or some other authority figure to “take care of it.” Many women are caught flatfooted (see above), and in that case it’s usually costly, not to mention scary. The extra costs aren’t necessarily due to investment mistakes, but due to unnecessary professional’s fees coupled with limited understanding of how much spending is appropriate versus the size of their nest egg.

The first thing I always hear from my private clients is: “I wish I had kept up with it; I feel so foolish.” You don’t have to take over responsibility for the job, but the more “in the know” you are, the better you’ll fare later when the transitional events present countless complex decisions about finances that have left many women feeling extremely vulnerable. Being at least functionally literate and fluent on the mechanics and aspects of the family finances creates a big financial gain in and of itself, whether you delve into investing or not.

Womenetics: What are the three pieces of advice you most often offer to women?
Dentino:

1. Engagement + Education = Empowerment (see above).
   
   
2. You don’t have to become an expert to be an effective agent over your finances (see above).
   
   
3. Keep it simple and just continue to learn. It’s no different than learning to play a new sport or musical instrument. It’s a process. You don’t start out in those as a virtuoso, so why do we expect we can just become successful money stewards overnight? No matter what anyone promises, there’s no magic bullet. But if you don’t start somewhere, that’s when you’ll feel the pain at some point.

Womenetics: How has that advice changed with the current economic downturn?
Dentino: It really hasn’t other than to remind women: It’s important to stay focused on the big picture, meaning you’re in it for the long haul. Day-to-day fluctuations can make you crazy, so to survive volatility and be able to sleep at night, you can’t buy into the hysteria. Especially in today’s world with so many information outlets, you’re constantly bombarded with information. It’s important to know who your trusted sources are and then tune out the rest of the “noise.” It’s important to stick to your long-term strategy, but that’s where it’s difficult for a lot of people. Human nature runs counter to what’s needed during volatility.

When everyone else is fleeing, you need to stand firm and recognize that opportunities are being created. You’ve literally got “stocks on sale.” The other advice is that, if you can’t take the volatility, the time to make decisions about your plan “B” is before the turmoil when your brain is functioning at a higher level for objective decision-making. Then stick to your plan. This is the most difficult part for most lay people, men and women: The discipline not to panic. Working with a professional will usually give you the discipline you tend to lack on your own.

Womenetics: If a woman is married, should she get separate financial advice from her husband?
Dentino: It’s not that marriage means get independent advice. What does matter is that you are prepared and will feel confident in the event you have to take over the reins. (This doesn’t mean I advocate “do-it-yourself” investing, unless you’ve got a long record of direct experience under your belt, and even then it’s not usually a good idea.) Think of it this way: You don’t want to be the only one in the room that doesn’t understand fully what’s being discussed by your professional advisers (financial, legal, etc.). You do want to have a working relationship with an adviser that communicates in a way you can fully understand, however. And one that doesn’t just talk jargon that goes right over your head. Your adviser should also be able to educate you along the way. It’s not that difficult, really, but some are so used to blathering jargon. It’s up to us to show Wall Street what we need.

Womenetics: What lead you into this type of work?
Dentino: I was always intrigued with Wall Street, but even beyond that from an early age, while other kids were still riding bikes, I was exposed to finance, money, and hearing about investments within my family. I had a very unusual orientation (I was to learn later) for a girl, but it was perfect because as a result, I never had any fear about math or money or investing. I’ve worked with families and shown them how to integrate these lessons with their kids at an early age, and the results are that young women are equally adept at learning about finances.

Womenetics: Do you believe that financial engagement is more important than ever due to the ups and downs in the financial world?
Dentino: The real issue/question is, do you have enough financial understanding to recognize that volatility is a given? The market cannot go up without sometimes going down. If you look back, there has always been volatility. Regardless of the ups and downs, it’s always important to be engaged and learning something new about the market or your personal finances. Statistically speaking, women are very recent entrants into this sphere versus men. The more behind-the-wheel training and experience you have, the more you’ll know and the quicker you’ll develop confidence about this complex and multifaceted discipline.

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Jan Jaben-Eilon was a founding staff writer of the Atlanta Business Chronicle. Since then, she has been the international editor of Advertising Age magazine and has written for such publications as The New York Times, International Herald Tribune, Washington Journalism Review, and Consumer Reports. She is the author of soon-to-be-published (There is) Life After Cancer. Jan and her husband have homes in Atlanta and Jerusalem.