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Industry Spotlight > Women in Wealth

High-Earning Female Investors Defy Stereotypes: Survey

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High-earning woman doing financial planning (Photo: Shutterstock)

Among the many stereotypes abroad about women and finances, one holds that they are more risk-averse investors than men and have lower investing acumen.

Survey results released this week by FlexShares Exchange Traded Funds indicate otherwise, at least for high-earning female investors, showing they have a similar if not greater risk appetite compared with high-earning men.

The survey focused on primary earners in households.

Thirty-one percent of men in the survey identified themselves as conservative investors, while only 14% of women did so. Overall, 26% of women surveyed considered their risk profile to be moderately aggressive or aggressive, as compared with 27% of men.

High-earning women also exhibited confidence in managing their finances and investments. Asked to rank their general investment knowledge on a scale of 1 to 10, women’s mean response was 7.3, compared with a combined average of 8.1 for all respondents.

In addition, women ranked their ability to perform financial planning tasks, such as creating a budget and managing investments, above 7.0 on nearly every activity.

The report noted that although men rated themselves above 8.0 on every task, both women and men exhibited high levels of financial knowledge.

“Many financial advisors continue to cling to outdated assumptions regarding female clients’ risk tolerance and overall interest in investing, which may not be accurate for high-earning breadwinners,” David Partain, head of marketing at FlexShares, said in a statement.

The survey was administered to 211 women and 250 men in March and April. Participants were 35 to 65 years old with household income of more than $200,000; they had more than $1 million in investable assets or more than $250,000 for those between 35 and 39 years old.

Different Priorities

The survey found significantly different priorities between women’s and men’s top current financial goals. Seventy percent of men said providing for future generations was their top priority and 62% said it was taking care of their dependents financially, compared with 30% and 38% of women who said this.

Sixty-nine percent of women said their main goal was “to know that I’m prepared for the worst,” compared with 31% of men who rated this as a top goal.

Women were also most concerned with planning for retirement and making philanthropic contributions.

On the home front, both male and female primary breadwinners reported taking on at least 50% of responsibility for dependent caregiving.

Half of the men said they were responsible for more than 50% of elder care in their family — including managing finances, care and transportation — compared with 41% of the women.

In addition, 49% of men versus 45% of women claimed to be responsible for a majority of childcare tasks.

However, men reported having a tougher time managing their work/life balance than women. A third of men said they felt guilty when they were at work rather than at home, compared with 21% of women who said they felt this way.

“Our research found that high-earning individuals don’t fit the mold of existing gender stereotypes, whether it’s the fact that male and female breadwinners both report taking on significant responsibility at home or that these women report more satisfaction with their work/life balance,” Laura Gregg, director of practice management and advisor research at FlexShares, said in the statement.

Gregg said it behooved advisors to put aside gender assumptions as they engage with wealthy primary breadwinners.

“What we see is that these professionals experience their roles as primary breadwinners differently,” she said. “Taking the time to ask first, rather than to assume based on gender, may help advisors stand out from the crowd and deepen client relationships.”

Advisor Experience 

High-earning women in the survey indicated greater loyalty to their financial advisor than men — though, FlexShares noted, studies suggest women tend to leave their financial advisor after divorce or death of a spouse.

Only one of five surveyed women said they had thought about leaving their advisor in the past year, compared with two out of five men. FlexShares said this may be because high-net-worth women take a more active role in selecting their family’s financial advisor than women in general.

Female respondents were also significantly more likely than men to describe their relationship with their advisor as personal.

In addition, women had a much more focused view of the services provided by a financial advisor. Across the board, men in the survey felt more strongly about advisors’ ability to offer specialized services such as insurance, estate planning, sustainable investing solutions and legacy planning.

Seventy-seven percent of men also said they expected business management advice from their advisor, such as corporate tax solutions or executive compensation advice, while 63% of women expressed interest in this service.

These differences notwithstanding, both women and men were keenly interested in in socially responsible investing. Sixty-two percent of respondents ranked their interest in SRI as an 8.0 or greater on a scale of 1 to 10.

Although SRI is often considered to be of greater interest to women and millennials, according to FlexShares, men in the survey expressed more interest in SRI offerings: 7.5 versus 6.8 for women.


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