Serving and Retaining Mass-Affluent Female Clients

Career women – single or married – are some of the most important clients for today’s advisors to find and retain. After all, women control a majority of the nation’s personal wealth, they live longer and they have greater and more unique needs when it comes to retirement and legacy planning.

“As women emerge as more of an economic force and become the financial decision-makers, we’re seeing the mass affluent woman as a more prominent client than a few decades ago,” says Kate Stalter, co-founder and senior advisor at Better Money Decisions.

Many advisors, however, are having a tough time retaining their female clients – particularly after death or divorce. Most women outlive their husbands, and while only 1 percent of women believe they’ll get divorced in retirement, the reality is closer to 20 percent.[1] Among widows and divorcees, nearly 70 percent end up leaving their advisors.[2]

In the first part of this series, we discussed marketing to mass affluent women – the ideal marketing tactics and communication strategies, as well as the qualities women search for in an advisors.

In this second installment, we’ll talk retention: Once you’ve gained these clients’ business, how can you solidify those relationships and build trust? And just as importantly, how can you serve their needs and help them meet their retirement goals – even when their partners have different priorities?

A focus on education

If recent data are any indication, women by and large feel disconnected from the financial services industry. Providers are dropping the ball when it comes to client education: According to a survey by Tiller, LLC and WorthFM, 63 percent of women believe investing is confusing, 75 percent say it’s tough to stay on top of their financial options, and nearly half say they’re not knowledgeable on investing.

What’s more, 84 percent of women were, are or expect to the sole manager of their finances, yet nine out of 10 often feel “sold to,” rather than educated, by financial services companies. Only 10 percent believe Wall Street pays equal attention to men and women, and 71 percent believe Wall Street is not in touch with their financial needs or concerns.

For advisors open to change, the situation presents an opportunity to differentiate, add value and provide a much-needed service.

“When I talk with a woman, the majority of what I do is education,” says Stryde Savings senior consultant, Meladee Rudolph. “I probably spend a good four hours educating a client before we talk numbers.”

What exactly should you discuss?

“I talk about the history of money, what the different financial tools are, why they came into being and how they’ve been used,” says Rudolph. “After that, we can talk more specifically about products and how those products meet their objectives.”

People will only act when they have a “why,” after all, and it’s only natural that a client who doesn’t understand the purpose behind a financial tool will be reluctant to use it.

“Most of the time I explain this stuff, clients end up saying it makes so much sense, and they ask me why nobody has told them before,” says Rudolph. Whether a client has managed her money for years or has been thrust into new territory following a death or divorce, it can help to take a step back and put things in context.

Differing priorities

Another critical consideration for advisors serving women is that these clients’ priorities often differ from their male counterparts’ – even their husbands’. “If you’re sitting down with a couple for the first time, it’s a big mistake to assume there’s one shared money goal, even if the male is the head of the household” says Ellen Pierce, managing director of UBS Wealth Management.

How might goals differ between husband and wife? Stalter recounts one possibility.