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Affluent Women Expect Honesty, Transparency From Advisors: Spectrem Report

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It’s hardly a stretch to think that wealthy women want honest, transparent financial advice, but a new report from Spectrem Group backs up that surmise with some powerful numbers.

Fully 98% of women with a net worth between $100,000 and $25 million, not including primary residence, say honesty and trustworthiness are key criteria for selecting financial advisors, according to "Wealthy Women Investors," a Spectrem eZine report released Thursday.

Similarly, 95% of wealthy women say they seek transparency and someone who will keep them informed.

"For wealthy female investors, openness, transparency and trustworthiness are the most important qualities in selecting a financial advisor,” Catherine McBreen, managing director of Spectrem Group, said in a statement. “Across the affluent, millionaire and ultra high-net-worth wealth segments, women want to be comfortable that advisors are focusing on their specific, personal financial needs—not on product or profit. In fact, a frank, straightforward approach is more important to wealthy women than investment track record, depth of products offered, referrals and even fees."

In Spectrem focus groups, wealthy women were wary of advisors who seemed sales driven or less than fully open and transparent. According to the statement, they made remarks such as:

  • "I feel like he is always trying to sell me the next new thing."
  • "Everyone is out for himself. He may act like he cares about me, but he really just wants to make as much money for himself as he can."
  • "I need the same amount of information that I receive from a doctor. Why is he recommending this investment? Is it best for me or for him?"

Spectrem's report includes other insights:

Wealthy women shun energy investments as well as socially and environmentally responsible funds:

  • 53% of affluent women are interested in environmentally responsible investments compared with 33% of men.
  • 47% of wealthy women would like to invest in socially responsible investments, compared with 33% of men.

Yet men show significantly more interest than women in energy related investments:

  • 33% of men would invest in oil ETFs compared with only 18% of women.
  • 21% of men are interested in oil limited partnerships compared with 10% of wealthy women.
  • 20% of men would invest in oil futures, but only 12% of women would do so.

 Wealthy women take financial news to heart. The report indicates that the more assets a woman has, the more likely she is to read the daily financial press or listen to cable television regarding her investments. Overall, she relies primarily on her financial advisor for advice, but as wealth levels increase, so does the interest in outside investment information.

The Spectrem eZine "Wealthy Women Investors" is based on a quantitative Spectrem Group study of 3,024 households, conducted from September to November 2010, as well as on focus groups and one-on-one interviews conducted on an ongoing basis. Spectrem's newly launched Millionaire Corner website incorporates Spectrem Group research as well as outside information. In the future, the site will offer financial advisor referrals, according to the statement.