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Brandy Mickens, divisional vice president at Equitable Advisors, says when her daughter’s daycare closed in early March because of COVID-19, “I actually cried.” 

Mickens, who has been with Equitable Advisors for 18 years, says the sudden closure was a shock for her and her husband. “I was thinking, what are we going to do to get through this period of time where we both have to work?” she says.

She immediately called her mother, who lives in a different city. Luckily, her mom was healthy and able to come to stay with Mickens and her family for a short time.

“That was the first phase, really just identifying that we were going to have to operate a little bit differently and start to think about contingency plans around this,” she says.

Where Advisor Support Steps In

Mickens’ experience is echoing across the U.S. as closed daycare centers and schools conducting remote learning have caused working parents to rethink child care. 

Because the responsibility of caring for the family tends to disproportionately fall on women, the coronavirus has impacted them more, says Kim Bourne, advisor at Avantax and wealth management advisor at Playfair Planning.

Now that some offices are reopening while many daycare centers remain closed and plans for reopening schools this fall remain in flux, many mothers are forced to make hard decisions about their jobs and families, with some women possibly having to leave the workforce. This not only has repercussions for employers, but also for women’s pay equity, financial wellness and future retirement security.

Financial advisors can offer guidance to working families and working women by reviewing families’ budgets. They can also offer more than just financial support; they can help clients explore all of their options and remind them of resources.

Financial and Psychological Impact

Mickens says as an advisor, she’s probably spoken to more of her clients in the last three months than in the last six months. She says she starts by reviewing their financial plans and budgets, especially if there’s been a change in income due to a job loss or furlough. 

The first step, Mickens says, is for couples to take a sharp look at their needs versus wants, and how they can make adjustments financially.

Stuart Riemer, managing director/partner, Treasury Partners at Hightower, says there are two related issues going on now. There’s the financial impact of COVID-19, which may affect people to a certain degree, but there’s a psychological impact, too, leading to many families becoming overwhelmed. 

That’s where financial advisors can help. “There are a lot of moving parts in terms of being able to manage the fallout,” says Riemer. “But it’s important to take a deep breath, get perspective and figure out a plan since this is reality.”

The three advisors say advisors should help women and couples explore their resources and how to build those up. That may include talking to family, friends and or even employers for help, whether it’s financial or childcare. People can be reticent to ask for help, but as Mickens points out, “everyone is going through this together.”

When it comes to juggling jobs and daycare, Mickens says her clients say their employers are a lot more understanding now, so it’s definitely worth it for women (and men) to talk to the boss about how they can work differently. That can include asking for a more flexible schedule.

What’s most important, Riemer reiterates, is that women do what helps them maintain their quality of life and mental health. That may include temporarily cutting back on 401(k) contributions to use that money to get women more resources. 

“If cutting back on (a 401k) keeps your mental health in check, sometimes you have to do that because you don’t want to have any negative impacts on your job or career because you weren’t taking care of yourself,” he says.

Making Decisions

Bourne says when she works with families who are contemplating having one spouse leaving the workforce, she considers all factors and not just pay.

“To be honest, a lot of times when we crunch the numbers, the benefits package tends to play a big factor, even more so in some cases than the salaries,” she says, and it may represent 30 percent of the salary. 

Sometimes those decisions aren’t financial at all, she says. If both spouses have competitive salaries, it may come down to who enjoys their work more, or whose job lends itself to being able to be done remotely. Then it’s about balancing schedules so that no one person is overwhelmed with childcare. Even so, Bourne says, “a lot of it falls to women because women tend to be the more ‘parenting’ parent.”

Advisors who work with women of color, especially Black women, have added struggles at this time. Findings show that Black and Latina mothers make up a disproportionate share of family breadwinners.  If she is a single parent, COVID-19 is even more exacerbating, challenging and stressful. 

“As financial advisors, we have to be conscious of that and really understand the dynamics of how the woman is thinking about her money, the fears that she may have around money and the additional complexities that she may be dealing with, especially in this environment,” Bourne says.

Finding Opportunities

Mickens, Riemer and Bourne say it’s important for advisors to help women explore other opportunities, whether with budgeting or otherwise. 

“On the surface, statistically, things do look somewhat grim,” Bourne adds. “But I think we have to help women find the silver lining and opportunities to bounce back.” 

Women may want to explore launching home-based businesses and take advantage of some tax benefits available to entrepreneurs who work from home. 

“We need to think about the business use of home and leveraging technology. It’s an opportunity for us to be creative about new ways to make money,” Bourne says, noting advisors can help women identify grants for small business owners.

When it comes to retirement savings, she says, if incomes have dropped, it may create opportunities that weren’t there before, such as funding Roth IRAs or performing Roth IRA conversions if families have dropped into a lower tax bracket.

“The whole retirement conversation is something that makes sense to pay close attention to,” Bourne highlights.