News Releases

• New "BMO for Women Survey: The State of Financial Planning for Business Owners" highlights notable gender gaps in business financial planning and transition planning, and personal wealth planning
• Nearly a third (32 percent) of women business owners have yet to consider or incorporate plans that will prepare the next generation or key persons to take over the business 
• In the survey results, more than half of high-net-worth women admit lack of interest and engagement in personal wealth planning 

CHICAGO, Oct. 18, 2023 /CNW/ - A new BMO survey reveals that despite meaningful progress, women entrepreneurs are still behind in critical aspects of business financial planning, transition planning and financial literacy compared to their male counterparts. The research found 64 percent of women business owners do not have a detailed financial plan for their companies, compared to 59 percent of men. In fact, as reflected in the data below, women business owners are significantly less likely to have considered how to manage many financial situations associated with their business.

"The importance for all business owners - but particularly women business owners - to have a financial plan for their companies cannot be overstated," said Shannon Kennedy, Head, U.S. Advisory and Interim U.S. CEO, BMO Wealth Management U.S. "Women tend to live longer, face industry-specific financial hurdles and center their wealth planning around their families. Having a detailed financial plan for their business is vital to ensuring continued growth and expansion, business owner's overall personal financial wellbeing, and making certain their families are taken care of. BMO has long supported women business owners and their unique wealth planning needs, and we look forward to continuing to be a leading partner for our clients to help them make progress." 

While having a well-considered transition plan is essential for the enduring success of any business, only a third (33 percent) of women business owners have a detailed plan compared to over half (52 percent) of men. Among the 25 percent of women business owners who do not have transition plans, the three main reasons cited include not having plans to sell their business (39 percent), never considering having a transition plan (25 percent), and not having plans to retire (21 percent).

There are several aspects of a business transition plan many women business owners say they have yet to consider:

• Women business owners are 10 percent less likely to consider strategies on how to transition out of their company without giving up control
• Nearly a third (32 percent) of women business owners have yet to consider or incorporate plans that will create the right incentives to prepare the next generation or key persons to take over the business
• 31 percent have not yet incorporated plans that allows them to access the equity in their business that helps them prepare for retirement and/or achieve other personal goals.

"Business owners have dedicated countless hours and resources to set up and grow their businesses, but many do not have a critical transition plan in-place," said Kaitlin Skopec, Director, Corporate Advisory, BMO Commercial Bank. "Transition planning is a vital and necessary tool for business owners to ensure the enduring and lasting success of their companies. It safeguards employees, stakeholders, family members – and most importantly, the business owner – from unexpected changes and external forces that are beyond their control. It is not about 'thinking about the end', it is about planning for the future. It is never too early to start thinking about a transition plan." 

The BMO survey also explored the financial preparedness of high-net-worth (HNW) women who are not business owners and found 57 percent of HNW women expressed that while they know it is important, they admit they find it difficult being interested in personal wealth planning. However, despite not owning a business, 86 percent of HNW women believe the best way to manage their personal wealth is to treat it like a business.

Similar to business owners, the survey reveals a gender gap when examining how women and men approach wealth planning.

• Portfolio Management: Women feel 17 percent less confident than men in their knowledge about portfolio management.
• Retirement Planning: Men are 10 percent more confident in their knowledge on retirement planning than women and 6 percent more likely to review these plans on a regular basis.
• Tax Planning: Men are 11 percent more confident in their knowledge on tax planning strategies and 8 percent more likely to use a financial advisor for such strategies compared to women.
• Estate Planning: Women are 13 per cent less knowledgeable about estate planning compared to men and 7 per cent less likely to have a detailed estate plan in place.
• Philanthropy: Only 62 percent of women feel knowledgeable about philanthropic strategies – 12 percent less than men.

"BMO Wealth Management is deeply committed to engaging women in their personal wealth planning," said Amy Griman, Global President, BMO Family Office. "High-net-worth women have increasingly specialized and complicated financial needs, and because of this, we have always emphasized the importance of women being involved in management of their personal wealth and taking ownership over their finances. Thoroughly understanding their personal wealth plan will help them be better prepared for unexpected life changes, like the death of a spouse or divorce, and empower them to manage their money and estate as they see fit."

• BMO was the first Canadian bank to sign the UN Women's Empowerment Principles in 2019, formalizing our commitment to advancing economic opportunities for all
• At BMO, we have 40 percent women representation in senior leadership. That diversity of thought in our workforce leads to innovation, better decision-making, and growth
• With over 3,000 members, the BMO Alliance for Women is a community of employees — of all genders — who champion the inclusion, connection, development, advancement, and support of women
• BMO Celebrating Women, the only bank-owned recognition program for women in North America, celebrates successful women who have given back to their communities or achieved success in business
• BMO has committed $3 billion in capital to women-led businesses in Canada. In the United States we are doubling our efforts in small business lending
• Bold(her) podcast: Bold(h)er delivers thought-provoking conversations that inspire listeners to make their own bold moves in business and in life

To learn more details about this survey, please visit: BMO for Women Survey: The State of Financial Planning for Business Owners - BMO Wealth Management

BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.25 trillion as of July 31, 2023. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to over 13 million customers across Canada, the United States, and in select markets globally. Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future, and inclusive society.

SOURCE BMO Financial Group