I’ve been working to help educate financial advisors on the needs and considerations of women clients for over a decade.
I’m thrilled to see more financial firms and advisors gain awareness of their unique considerations, but we’ve still got a ways to go in ensuring that all clients are understood and nurtured appropriately.
Today offers you a great opportunity yet to take the lead in earning the trust and respect of all of your clients, empowering them to make the right choices for their own lives, whether they are working on long-term care (LTC) planning, retirement planning, or any other type of planning or risk-management effort.
Here’s what you need to know to get started:
The backstory and stats
Up until now, the industry has by and large looked upon women as a niche market- inferior to ‘the real market’ they’re after. But women are in fact the real market just as much as men in today’s world, given their unique positions within modern American families and their longevity.
The Harvard Business Review reports that private wealth in the United States is expected to grow from some $14 trillion to $22 trillion by 2020 and 50 percent of it will be in the hands of women (“The Female Economy”, 2009).
We spend about $5 trillion annually, over half of the U.S. GDP according to a recent report by She-economy; 29 percent of us out-earn our husbands (U.S. Bureau of Labor Statistics, “Women in the Labor Force”, 2013); and 95 percent will be the primary financial decision maker in our families at some point in our lives (“Financial Experience & Behaviors Among Women”, 2010-2011).
Yet the financial advisory industry doesn’t yet reflect these and other gender changes that have occurred within our higher educational system, workplace and homes. For instance, only 31.2 percent of personal financial advisors today are women (U.S. Bureau of Labor Statistics, “Women in the Labor Force”, 2013). More foreboding for the industry as a whole, a staggering 73 percent of women polled cite their dissatisfaction with the financial service industry above all others (The Boston Consulting Group, “Women Want More”, 2009).
No matter where they reside, what their occupation is or how much personal wealth they have accrued, women consistently share with me the same frustrations towards their personal financial advisors: ineffective communication; a lack of sensitivity to their objectives; and a condescending demeanor.
Women show an alarming lack of enthusiasm and loyalty to their financial advisors, with every major financial firm documenting their distrust of the industry in one form or another.
For instance, a staggering 69 percent say they don’t view their financial advisors as their go-to source for information (Allianz Life, “Women, Money & Power Study”, 2013).
Feeling misunderstood and even inferior, it’s little wonder that women are more likely to funnel their money into checking and savings than to work with an advisor to put their money to work for them in the right financial products and investments.
I’ve personally witnessed advisors all but ignore female spouses in their offices, instead speaking directly to male spouses with the inaccurate notion that they are the ones who must be targeted with the information, game plan or product. Many women want to full digest information before making a final decision…and who can blame them? After all, they will be left holding the bag long after their spouse is gone.