Laura Wellington was left in the financial dark when her husband, Dean, died in 2002.
At age 35, Wellington was a widow with four children; a boy, 9, and three girls aged 3 through 7. She also became the head of her husband's two small information technology businesses. Like many couples, before her husband's death, she took care of the day-to-day household expenses, and he handled bigger money issues like insurance and investing.
"I knew a certain amount of what was going on," she recalled. But the majority of the decision making was left to Dean.
When he was gone, the Ridgewood, N.J., mom had to make sense of everything on her own.
Stereotypes say situations like Wellington's usually involve women who lose their husbands late in life, then face financial uncertainty as they puzzle through bank accounts and investments for the first time. But it's not just older women who leave the big money questions to their husbands. Despite strides in the workforce, traditional roles are still common at home. Women as young as their 20s frequently defer financial decision making to their spouses or even their fathers.
"I find that still, especially if they're stay-at-home moms, they're not in the know, or they don't have equal say," said Lyn Dippel, a financial planner with Financial Advantage in Columbia, Md.
With intense study and some professional advice, Wellington has brought herself up to speed. Nevertheless, the experience taught her a lesson. "I will never let my daughters out in the world, or my children out in the world, without a knowledge of money," said the now 44-year-old, who has since had another son, and co-founded a new retail business focusing on children's characters.
Exposure to financial issues is essential to help prepare young people to handle money as adults. Studies show that parents have the single most important impact on financial behaviors and knowledge.
But women tend to get less information — and what they're taught more often focuses on savings and budgeting than estate planning and the stock market, said Carrie Schwab Pomerantz, president of the Charles Schwab Foundation and a member of the president's advisory council on financial capability. Few families have frequent conversations about money, and when the topic comes up, they "speak to their daughters differently than their sons," she said.
As a result, by the time daughters become women, they're less likely to be familiar with the language of investing, which alone can intimidate. That's compounded by much of the available information seeming like it's targeted toward men. "If you watch CNBC, it looks like ESPN," said Dippel. "It does not speak to women in the way that women want information."
Another factor is that financial issues can also be very emotional, making it harder for women to take control, said Amanda Gift, a financial adviser at Signature, a Norfolk, Va., wealth management firm. "You couple some level of insecurity or intimidation with huge emotion, and that can make for a daunting task."
The best way to break down the intimidation factor is to start teaching kids about money as early as possible.
Financial literacy advocates say even toddlers can begin to learn about making choices at the store. By the time kids are in kindergarten, they should be introduced to the concept of money, and within a few years they should have been inside a bank and opened a savings account. Tweens can be taught to balance a checkbook, have some of their own money and be allowed to make choices about spending, saving and charitable giving. Teenagers should have their own checking account and be introduced to investing issues.
"What's easiest for parents to do in a busy world is look for those teaching moments," said Kathleen Burns Kingsbury, owner of KBK Wealth Connections, an Easton, Mass., consulting company. She suggested having discussions about prices and choices during back-to-school shopping, and using opportunities like watching television to question the money messages being shown.
"If you can make learning about money and learning about finance fun and kind of a game, and start instilling some of these messages early on, it's going to make a huge difference," she said.
So can exposure to programs that introduce investing concepts.
Shantia McCarthur, 15, takes part in a program co-sponsored by ING and Girls Inc. that teaches the basics of investing to girls at her Brooklyn, N.Y., school. She was one of 12 girls given a pot of $20,000 to invest in the market in the winter of 2009. "We learned that it's all about decisions, and your returns depend upon the actions that you make," she said.
The girls have grown their investment by more than 15 percent, and McCarthur hopes that will expand further before she's ready to take her share to help pay for college. "I think I want to go to Harvard," she said.
She's also shared what's she's learned about investing with relatives and friends, and become an inspiration for the fledging investments of the aunt with whom she lives. "I pretty much told her everything I learned," McCarthur said. "It's like I'm the girl backstage."