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How women can plan better financially and emotionally for taking time away
Taking a break from work for caregiving, personal growth or health reasons is no longer an uncommon experience for women. But while these leaves are a natural part of life, they often bring with them unique challenges – both financial and emotional. Planning for the time away, and even more importantly, for the return, requires thoughtful consideration of long-term impacts on career trajectory and personal well-being.
Looking back at her own leaves from work and those of her employees and clients, Maria Miletic has concluded that communication is the difference maker.
“Communication is really key for managing the finances and managing the emotional side of returning with all parties involved,” says Ms. Miletic, an associate portfolio manager and investment advisor with Richardson Wealth in Calgary. “I think people just expect you’ll go and everything’s going to be exactly the same when you come back, but that’s absolutely not right.”
Stepping away from work for a time – which can have an impact on your long-term finances, family life and career, plus how you feel about yourself – happens often. A 2022 LinkedIn survey of 30,000 employees and hiring managers found 62 per cent of employees took a break at some point in their careers, with 35 per cent of women expecting to take a leave in future.
“It’s part of life in general,” says Alexandra Horwood, portfolio manager and investment advisor with Richardson Wealth, based in Toronto. She has two children and took part-time leaves when they were newborns.
People may take a break to care for a spouse or an elderly parent, or for their own health – a 2022 study found that one third of all disability claims were related to mental health. Women are more likely to take mental health leaves, with caregiving stress a common factor. (Some breaks are also for travel or education – Ms. Horwood recently had an employee pause her job briefly to finish a professional certification.)
Frequently, a work break is about women shouldering care and its repercussions, says Ms. Horwood. “I see women are often the ones compromising in the relationship. I’m a big advocate for having open conversations with spouses to talk about what they are each prepared to contribute around shared responsibilities.”
Here’s how to talk openly and plan for a leave before it happens (if you can), during the leave and after to lessen the financial, mental and career strain.
Planning ahead: securing your financial future before taking leave
Some breaks, such as maternity leaves, come with advanced notice, which allows for strategizing. “The first thing that you may want to prioritize is to make a budget. And it really should be a family budget,” says Ms. Horwood.
A budget for a mat leave should include a baby fund that covers essential gear, ongoing supplies such as clothing and diapers, that also looks ahead to future costs such as childcare and registered education savings plan (RESP) contributions.
“Figure out firstly what is essential to the family, making that a priority. Then prepare a ‘wish list’ for nice-to-have but optional expenses like travel,” Ms. Horwood says, noting that the best gifts from grandparents and others can be practical, such as RESP donations.
Now’s the time to bulk up your emergency fund to cover at least six months of household expenses – you should have one anyway, but during a leave you might need to dip in.
Smart budgeting during your leave
You can’t plan for all leaves, but if a sudden illness or another urgent situation sees you taking time off work, you can still have a conversation about money early on. Ms. Miletic suggests setting up a joint account with your partner if you don’t have one already. “So that person is not having to request permission for something. The money is already there.”
Some women opt to reduce their contributions to retirement savings while off. Ms. Miletic says one of her high-net worth clients recently did this. “She’d made up her mind to keep contributing in advance, but then she came back and said, ‘You know what, having just a little bit extra in the bank account is going to make me feel better.’ "
However, there is still a significant gender pension gap to contend with as women earn 83 cents for every dollar a man does in retirement, according to the Ontario Pay Equity Office. Reducing payments to pensions or registered accounts should be done for as short a time as possible. Many workplace pensions have a buyback option, so you may be able to make it up later.
Establishing your new normal
In the past, leaves entailed a total break from your work team. Now, more people are staying in touch, which can enable an easier return, as can remote work.
“For women and especially for new parents, working from home can be really nice. It can make the return to work less jarring and more of an ease back in,” says Ms. Horwood. She says neither leaves nor returning to work have to be black and white – doing either on a part-time basis or gradually might be a fit.
Once you’re back to your new normal, work wise, Ms. Miletic recommends revisiting your budget, restarting your savings, and rejigging around new realities such as childcare costs or someone in the house working less or differently.
“This thought of ‘my income versus their income,’ that’s where people do get in trouble,” says Ms. Miletic. Any changes need to be considered a whole-family issue, with sacrifices being shared by all.
Easing the emotional transition back to work
Returning to work after time away can bring up intense feelings. Some are excited to get back to their routines, while others feel overwhelmed by the competing demands of caregiving, work, and personal growth. For many women, guilt and anxiety are common emotions, especially when it comes to balancing responsibilities.
Ms. Horwood recalls her leaves made her anxious, and she sees women grapple with conflicting feelings around wanting to care for others, keeping up with their careers and feeling guilty. “There are competing priorities, and a series of compromises that often must be made,” she says.
Ms. Miletic emphasizes the importance of mindset.
“You have to stay present in that moment and know what you’re doing this for. It’s hard if you’re only thinking about the income loss during that time – it’s not going to make the leave good for you.”
Pushing against outdated norms
Having a cooperative family and workplace goes a long way in making both a leave and the return to work smoother. However, it’s crucial that women feel empowered to ask, advocate, and educate those around them, challenging outdated expectations and norms.
“I feel strongly that women should take action to gain self-confidence and stand up for themselves, starting by advocating for the things we need, and not just accepting what is given to us without challenging what is in our best interests,” stresses Ms. Horwood. By proactively communicating their needs and pushing for more equitable arrangements, women can ensure their transitions in and out of the workplace are better supported, both emotionally and logistically.
By planning ahead, having honest conversations with your partner, workplace, and financial advisor, and being mindful of your mental well-being, you can make the transition smoother. Richardson Wealth’s expert advisors can support you in navigating these financial decisions, ensuring you’re prepared both during and after your leave. Remember, it’s your journey, and with the right support, you can successfully balance your personal and professional life with confidence.
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Advertising feature produced by Globe Content Studio with Richardson Wealth. The Globe’s editorial department was not involved.